BioTechnica International Inc., a hybrid biotechnology companywith both medical and agricultural research, announced that itwill sell its medical business to a management group and focuson farm producs.
BioTechnica (NASDAQ:BIOT) will transplant its corporateheadquarters from Cambridge, Mass., to Overland Park, Kan.
The stock closed Wednesday at $1.813 a share, down 31 cents.
The company signed a letter of intent with the managementgroup to sell a majority stake in its diagnostics, bioproducts andagricultural microbial programs, subject to agreement on thevalue of assets and liabilities. The group agreed to assumecertain liabilities and forgive severance payments underemployment contracts, said Stephen Hall, BioTechnicaAgriculture's chief financial officer. Included is a dentaldiagnostic product that is jointly marketed with Johnson &Johnson.
Transaction details were not disclosed, but BioTechnica did sayit will retain a 19 percent stake in the new company and thatthe sale should be completed by Feb. 28. The company plans totake a $6.5 million charge for restructuring in the quarterended Dec. 31. BioTechnica is also selling its Cambridgeheadquarters and laboratory facilities.
The unit's sale is aimed at trimming BioTechnica's annualoperating loss by $5 million. It reported a $7.6 millionoperating loss for the nine months ended Sept. 30. And it begantrimming a 300-member work force last summer.
BioTechnica's focus on corn and soybean seed wasforeshadowed by three years of seed company and otheracquisitions, such as the 1989 purchase of Molecular Genetics'plant business for $4.1 million. The company announced lastJanuary the first successful transformation of a corn gene into asubsequent generation.
-- Ray Potter BioWorld
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