The group has made no secret of its desperate desire for cash and was thought to be down to its last few pennies.
Its saviour is Kevin Leech, the multi-millionaire Channel Islander who controls ML Laboratories, the drugs group thought to be on the verge of a deal with Glaxo Wellcome.
Through his private company, Milner Laboratories, Mr. Leech is buying up to 29.9 per cent of Proteus, including a pounds 1.5m rights issue subscription.
The deal should provideProteus with the resources to continue its work and will possibly give the group a much needed cash flow, through a licensing deal.
Proteus is one of the bio-babes which has failed to perform and could be regarded as a warning to the investment herds chasing the junior drug shares. Four years ago the shares were riding high at 496p but since then they have wilted as the group's difficulties became increasingly apparent.
On the ML deal its shares rose 7p to 72p; ML slipped 6p to 431p.
The big stock market story involved Cable and Wireless and BT; a deal between the two telecom giants was confidently expected and after trading Cable duly confirmed "exploratory discussions" were again under way.
For much of the session the market was on tenterhooks, speculating about the rumoured deal. There was talk of Cable and BT talking to US investors and discreet meetings to persuade the Whitehall powers to sanction what would be Britain's biggest-ever corporate liaison, possibly worth as much as pounds 35bn.
The BT/Cable story has, in varying degrees, been sloshing around the system for the past few days. At one time it seemed the deal was off. But BT's increasingly strained relationship with its industry regulator and Cable's management vacuum have encouraged the two to resume talks.
Cable shares shot ahead 34p to 511.5p, a peak. Seaq put volume at more than 10 million shares. They should make further headway today. BT gained 14.5p to 348.5p.
Because of Cable's ramshackle overseas investments, including control of the powerful Hongkong Telecom, there is a firm belief that any deal will be undertaken through a reverse takeover - Cable bidding for BT. Rumours suggested the terms would value Cable at approaching 590p.
Orange ignored the telecom buzz, ending 7p lower at 230.5p.
The BT/Cable excitement helped the FT-SE 100 shares index to end the day with a plus, albeit a modest 0.2 points to 3,672.6. At one time it was down 22.4 on disappointment that German interest rates were unchanged.
Utilities were mixed following the United Utilities shake out. UU gained 14p to 611p; Hyder, another combined electricity and water group, rose 18p to 752p.
Ladbroke, the betting and hotels group, continued to attract speculative attention. It has been in the firing line for four months and despite the lack of action a surprisingly large number of market players remain convinced a deal is in the offing.
Bass, the brewing and hotel group, remains the favourite to strike, although the US Hilton Hotel Corporation and British brewing groups Scottish & Newcastle and Whitbread are regarded as possible predatory candidates.
The shares cantered ahead 3.5p (after 6p) to 192.5p in brisk trading. Observers believe Ladbroke is currently under examination and so long as any investigation does not produce a negative conclusion the predator will show its hand in the next few weeks.
Stakis, the casino and hotel group, was also thrust into the bids frame. Scottish, which has trading lines with Stakis and was once a significant shareholder, was said to be on the prowl.
The theory is that Scottish has become much more conscious about the attraction of big catering pubs as well as hotels since it acquired the Chef & Brewer pubs chain from Grand Metropolitan. Stakis gained 2p to 104p, a 12-month high, in busy trading.
JKX Oil & Gas was one of a number of companies operating in the former Soviet Union to move ahead as a leading securities house, thought to be Salomon Brothers, made positive noises about prospects. The shares rose 13p to 156p. Bula Resources edged forward 0.5p to 3.25p.
But Pan Andean, the high flyer seeking oil in Bolivia, had a subdued session , falling 11p to 70p.
o Biotrace International is the latest bio babe to attract a buy recommendation from Dr Erling Refsum, the drugs analyst at Yamaichi, the Japanese group, who has achieved a reputation as a shrewd pharmaceutical follower. He sees the company edging into profits next year and is impressed with the new management and the beneficial changes which have followed. The shares held at 61p.
o Vaux, the brewer and hotelier, has abandoned its bid to become a nursing home power. It has hung a "for sale" sign over its 35 St Andrews care homes and will use the resultant cash to develop its pubs and hotels. Some believe the group is a takeover target with its hotels the prime attraction. The shares held at 272p.Reuse content