Escagenetics Corp. has filed for its first stock offering since itwent public in 1987.
The company anticipates a maximum of $8.1 million inproceeds from the sale of 1.8 million shares of common stockon a "best efforts basis."
Reich & Co. Inc. is the placement agent for the offering, whichEscagenetics registered with the Securities and ExchangeCommission on Thursday.
The San Carlos, Calif., company also said it has raised $1 millionthrough the sale of an interest-bearing convertible debenture.That debenture converts automatically into 200,000 shares ofcommon stock (ASE:ESN) if it is not paid on or before Dec. 31.
The new stock offering and the debt financing could provideEscagenetics with a much-needed cash infusion. The companyhasn't raised any cash since February 1992, when it garnered$6.75 million in a private placement, managed by VantageSecurities, of 900,000 shares of unregistered common stock at$7.50 per share.
Escagenetics closed its 1993 fiscal year on March 31 with cashassets (including cash, cash equivalents and short-terminvestments) of slightly more than $2.1 million; its liabilitiestotaled close to $1 million.
Escagenetics has "had to make do with limited resources" forsome time, said George Dahlman, an analyst with Minneapolis-based Piper Jaffrey & Hopwood. "The fact that they've survivedthis long is incredible."
Still, Escagenetics has persevered through tough times before.In fact, the company used the IPO back in 1987 to emerge froma chapter 11 bankruptcy (at the time the only U.S. company toadopt this unique means of accomplishing a corporatereorganization).
The fact that the current public offering is being done on a bestefforts basis "still profiles the risk and uncertainty surroundingthe Escagenetics story," Dahlman said.
Escagenetics' stock closed unchanged Thursday at $6.75 ashare.
-- Jennifer Van Brunt Senior Editor
(c) 1997 American Health Consultants. All rights reserved.