Xceed Capital [ASX: XCD] has agreed to sell its 64 per cent stake in PolyNovo Biomaterials to Metabolic Pharmaceuticals [ASX: MBP].

The sale has been on the cards for some time, but both parties have finally signed off on the deal.

Under the arrangement Xceed, an investment company, will trade Metabolic its stake in return for 1.5 MBP shares for every PolyNovo share Xceed owns.

The deal must still be approved by both Xceed and Metabolic shareholders. Xceed is holding a shareholder's meeting to discuss the sale in November.