Crop Genetics International has agreed to acquire Espro Inc., acompany that is developing a low-cost process for producingand purifying of a wide range of insect virus products (IVPs),which are used as biological pesticides.
The deal has a total value of about $3.9 million. Crop Geneticswill exchange 450,000 shares of its common stock(NASDAQ:CROP), which closed up 25 cents on Tuesday at $4.25,to acquire all of Espro's capital stock. In addition, CropGenetics will pay up to $750,000 in cash and an additional300,000 shares if certain performance tests are met.
Crop Genetics is developing biological crop protectionproducts, including insecticides, fungicides, bioherbicides anda disease-free sugarcane seed.
IVPs have been shown to be environmentally safe and aseffective as insecticides, "but the problem is that they don'tact as quickly as chemicals, and more important, no one hasbeen able to figure out a method to produce them inexpensivelycompared to chemicals," said Joseph Kelly, chief executiveofficer at Crop Genetics of Hanover, Md.
Although Crop Genetics and Espro are not addressing the speedproblem, "the fact that the safety of chemicals is coming intoquestion makes biological products such as this much moreattractive, so that the need for quick kill has been mitigatedto some extent by the environmental demand."
Crop Genetics plans to sell the IVPs through internationalcorporate partners and has started discussions about a jointdevelopment and marketing agreement.
-- Kris Herbst BioWorld Washington Bureau
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