BIOCURE Holdings, the struggling diagnostic and research company based in Aberdeen, is set to expand its presence in the medical equipment sector with the acquisition of a private company specialising in the disposal of used hypodermic needles.

If approved by shareholders on July 25, the deal will lead to BioCure changing its name and de-listing from the main market of the Stock Exchange. Shares in the enlarged company, to be known as Medisys, will trade on the junior Alternative Investment Market.

The acquisition target is Needle Incinerator Company, which specialises in the disposal of biohazardous medical waste. Set up in London in May 1995, its main product is a self-contained disposal system that incinerates used needles on-site in clinics, hospitals and doctors' offices.

Although there have not yet been any sales of the device, the NiC1800, NIC said it had orders in hand worth about #3.3m. Shipments on some of those orders, the first of which are destined for Brunei and India, will begin today.

BioCure, which was established in 1984 to search for a cure for cancer, flagged up the deal last month when it asked the Stock Exchange to suspend trading in its shares. That move followed several weeks of speculation which sent the tiny company's stock surging from the 8p to 10p level where it had languished for almost nine months.

The company's shares hit a peak of 34.5p before they were suspended at 27.5p, giving BioCure a market capitalisation of #18.3m. However, it intends to pay the equivalent of #27.7m for NIC through the issue of roughly 100.5 million of its own shares.

The new shares, which are expected to begin trading on AIM on July 28, will account for about 60% of the enlarged group's issued Ordinary share capital.

The move to AIM is necessary because NIC, the larger of the two companies, does not have the profitable two-year trading record required for a main market listing. It made pre-tax losses of #668,000 during its first 13 months in operation, followed by increased losses of #990,000 during the seven months to the end of last year.

The speculation that led to the jump in BioCure's share price was linked to CM Holdings, which acquired a 24.4% stake in the Aberdeen company after underwriting a four-for-five rights issue in April. CM Holdings is the Monaco-based investment vehicle of Michael Charlton, one of the backers of Andrew Reagan's Lanica Trust.

Like his counterpart at BioCure, the head of NIC dismissed the idea that the Aberdeen-based company would be turned into a vehicle for corporate activity. He said operations within BioCure, which include cancer research and the manufacture of diabetic test kits, would continue to be funded at ''at least'' their present levels.

''Are we here to wheel and deal on paper? No, we're here to produce product and sell it,'' NIC's Michael Coy said. He added that his company had had no previous dealings with CM Holdings, whose stake in the enlarged group will drop to around 10% after the merger.

As part of the deal, Mr Coy will become managing director of Medisys. He will be joined by colleagues Brian Timmons and James Chan, who will serve as finance director and commercial director respectively.

BioCure's chairman Bill Bruce will continue as non-executive chairman of Medisys, while non-executive director Derek Ablett will also remain on board. Mr Ablett joined the company in April following the four-for-five rights issue.

Mr Coy, who headed the Hawaii Economic Development Corporation until 1980, has been involved in venture capital and early-stage business development organisations since 1971. He got involved in CIN after completing a project in the US with Medical Consultants Management, the Jersey-based venture capital operation specialising in medical transfer technology.

MCM, whose 40% stake in NIC will translate into about 19.5% of the enlarged group, introduced Mr Coy to UK inventor Nicholas Constable. He developed the NiC1800 and is the company's director of research and development.

Other shareholders in NIC include government-backed Malaysian investment company Permodalan Nasional Berhad, which paid #3m in April for 27,000 shares in the business. It will have about a 12.5% stake in Medisys, while NIC's 20 or so directors and employees will control roughly 20% of the operation.

Mr Coy said the synergy between NIC and BioCure was in their home-use products for diabetics. Each operation will use the other's distribution network to gain access to new markets.

NIC is currently working on a domestic version of NiC1800, which is due to hit the market by January 1998. This is viewed as a perfect partner to BioCure's Hypo-guard product, which allows diabetics to measure their blood-sugar levels.

Mr Coy also pledged support for BioCure's cancer research operation, which will continue to be located in Aberdeen. However, in the future it will likely work in partnership with one of the large pharmaceutical companies.

''We've done some due diligence on the quality of work and research being produced at Aberdeen, and we think there is some value there that can be commercially recognised,'' he said. ''They have patented some molecules and done some interesting re-search in wound healing.''