Immuno-oncology company Stellar Biotechnologies Inc (Nasdaq:SBOT) reported on Friday the launch of a share exchange agreement with Edesa Biotech Inc and the latter's shareholders, under which, Edesa will become a wholly-owned subsidiary of Stellar.

As part of the share exchange agreement, Edesa shareholders have agreed to exchange their shares of Edesa for newly-issued common shares of Stellar. The proposed transaction, which will result in a change in control, is expected to close during the second quarter of 2019, subject to customary closing conditions.

In conjunction with the closing, Stellar's current shareholders are expected to own approximately 10% and the current shareholders of Edesa are expected to own approximately 90%, of the combined company on a fully-diluted basis, subject to a 2% upward or downward adjustment.

Following the closing, Stellar will change its name to Edesa Biotech Inc as well as intends to develop a plan for the disposition of Stellar's operations, which is expected to include the wind down or spin-off of Stellar's legacy business.

Stellar Biotechnologies Inc is the leader in sustainable manufacture of Keyhole Limpet Hemocyanin (KLH), an immune-stimulating protein utilized as a carrier molecule in therapeutic vaccine pipelines (targeting cancers, immune disorders, Alzheimer's and inflammatory diseases) and for assessing immune system function.

Based in Toronto, Canada, Edesa Biotech Inc is a clinical-stage company focused on efficiently developing innovative treatments that address significant unmet medical needs. Its leading product candidate, EB01, is a novel non-steroidal anti-inflammatory molecule for the treatment of allergic contact dermatitis, which has demonstrated statistically significant improvements in multiple clinical studies.