CAMBRIDGE, Mass. -- Genzyme Corp. said Monday that it soldfor $10 million a minority stake in Gene-Trak Systems to itspartner, Amoco Biotechnology Co. of Naperville, Ill.
Other terms of the deal were not disclosed.
Genzyme (NASDAQ:GENZ) acquired the interest in Gene-Trakthrough its merger with Integrated Genetics in 1989. Genzymeand Amoco Biotech, a subsidiary of Amoco Corp., signed lastApril a letter of intent to sell Gene-Trak to the Hoechst Groupof Germany. That deal collapsed in June.
Gene-Trak started in 1986 as a 50-50 partnership betweenAmoco and Integrated Genetics, but Amoco's stake grew as itput cash into Gene-Trak. Margaret McGeorge, a biotechnologyanalyst at Sutro & Co. in San Francisco, estimated Amoco'sshare to be 70 percent to 75 percent.
"This was a good deal for Genzyme," said McGeorge, in view ofGenzyme's strategy since buying Integrated Genetics. "It's atextbook case of how an acquisition should be done."
Genzyme paid $31 million for Integrated Genetics, gaining $12million in cash and $12 million worth of tangible assets,McGeorge said. It then sold IG's fertility hormone project toAres-Serono for $12 million and spun off IG Labs last Maythrough a public offering that netted $13.9 million.
Gene-Trak markets six diagnostic food tests and two clinicaltests, for HIV-1 (human immunodeficiency virus) andcytomegalovirus. Despite these products, Gene-Trak was neverprofitable. --Karen Bernstein
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