Pharmabiz
 

BBII to sell diagnostics, biotech divisions to SeraCare Life

West Bridgewater, Mass.Monday, April 19, 2004, 08:00 Hrs  [IST]

Boston Biomedica, Inc. (BBII) announced that it has signed an Asset Purchase Agreement to sell substantially all of the assets and selected liabilities of its BBI Diagnostics and BBI Biotech Divisions to SeraCare Life Sciences, Inc. of Oceanside, California (SRLS). The purchase price is $30 million in cash, plus the assumption of certain liabilities, and is subject to adjustment at closing based on the value of the net assets being sold. Of the $30 million purchase price, $2.5 million will be held in escrow for a period of 18 months following the closing. The closing, which is expected to occur by August 15, 2004, is subject to a number of conditions, including the approval of the transaction by BBI stockholders and SeraCare's receipt of sufficient financing to complete the transaction. BBI's two largest stockholders have agreed to vote their shares in favor of the proposed transaction. SeraCare expects to finance the transaction primarily with debt, along with some equity financing, and has agreed to use commercially reasonable efforts to obtain the financing between now and August 15, 2004. R. Wayne Fritzsche, chairman of the board of BBI, said: "We are pleased and excited about this anticipated transaction. We believe the businesses of the two companies fit extremely well together, with the strengths and capabilities of each clearly augmenting and supporting the other. We also believe that the combined entity will have an experienced and capable staff, a strong technology base, a more comprehensive product line and customer base, and better access to capital. This transaction will also enable us to focus our efforts on our novel Pressure Cycling Technology (PCT) activities." Fritzsche continued: "If the asset sale to SeraCare is completed, shortly thereafter we plan to use up to $ 21,000,000 of the after-tax net cash proceeds from the sale to commence a tender offer to purchase up to 6,000,000 shares of our common stock at a purchase price of $3.50 per share. The remaining net proceeds from the sale, after taxes and including any portion of the escrow released to BBI and an additional amount estimated between $1-2 million, are expected to be used for working capital for our PCT activities. We believe the tender offer will provide each of our stockholders with the opportunity to decide whether to tender and sell their stock or not tender and remain a stockholder and participate in the surviving company's PCT activities." Boston Biomedica also announced that it has entered into a non- binding Letter of Intent (LOI) to sell the assets and selected liabilities of its BBI Source Scientific Division (BBI's California-based Instrumentation Company) to an entity to be jointly owned 70 per cent by Richard W. Henson and Bruce A. Sargeant and 30 per cent by BBI. Henson and Sargeant are medical instrument executives with many years of experience in the instrumentation field. The LOI calls for BBI to receive a 3 year Note for $900,000. The LOI also calls for the new instrumentation company to provide engineering, manufacturing, and other related services for BBI's Pressure Cycling Technology products until September 30, 2005. Fritzsche concluded: "If we are able to complete the sale of our BBI Diagnostics and BBI Biotech Divisions to SeraCare and if we are able to sell the BBI Source Scientific Division pursuant to the LOI, the Company will be focused exclusively on PCT activities."

 
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