ResApp shareholders vote in favour of Pfizer takeover after five-month tussle

ResApp directors and executives breathed a sigh of relief on Wednesday after shareholders voted to sell the company to Pfizer.

ResApp directors and executives breathed a sigh of relief on Wednesday after shareholders voted to sell the company to Pfizer.

About 82.2 per cent of shares were cast in favour of the deal after a meeting in Sydney dominated by questions from former House of Representatives speaker Peter Slipper, a shareholder.

ResApp has been working on a smartphone app to analyse the sound of a cough to detect Covid-19. If it succeeds, it could transform testing worldwide.

In June, a study revealed that ResApp’s algorithm achieved a sensitivity of 84 per cent and specificity of 58 per cent. This was below the minimum thresholds of 86 per cent for sensitivity and 71 per cent for specificity and “significantly lower” than the results of ResApp’s pilot study. That resulted in Pfizer amending its takeover offer to 20.8c a share.

Had ResApp replicated the results of its pilot (which achieved 92 per cent sensitivity, exceeding the real-world measured sensitivity of rapid antigen tests), Pfizer would have paid ResApp shareholders another $53m.

ResApp chief executive Tony Keating on Wednesday said the company’s shareholders would be handed a “significant premium”.

“In the context of the current economic environment and the continued costs and risks of commercialising our technology, the board believes this is a good outcome,” he said. The deal is ­expected to be implemented by September 23.

Separately, ResApp executive director Brian Leedman told The Australian: “I was relieved that Pfizer saw the value of wanting to put the offer up. There would be a level of embarrassment if the transaction failed because they’re buying a public company that’s immaterial from an acquisitional point of view.”

However, investors opposed to the deal appeared to have flipped on their stance by Wednesday, after a recent ResApp report showed it was losing between $1m and $2m every three months.

Wednesday’s result, subject to approval from the Supreme Court, will see the company cease trading on the ASX after September 14.

Despite the result, some investors were less than impressed.

Peter Macks told The Australian he had voted against the buyout, believing the price of the technology was “well north” of 20.8c a share. “I struggle with 20c a share considering the opportunity and the multiple dimensions it’s got,” he said.

“I believe in the product and want to see this technology remain commercially in Australia.”

Udantha Abeyratne, inventor of the technology, was also in attendance, and said he was happy to see a deal closed out after a difficult few months. “The initial target was to come up with the technology to be sent all over the world,” he said, adding under Pfizer’s ownership “it can happen”.