Nanogen, Elitech deal
The companies will reverse-merge, combining Nanogen’s molecular and point-of-care diagnostics with Elitech’s in vitro diagnostics for the clinical chemistry and microbiology markets. Elitech shareholders will own 58.7-68.7% of the combined company, which will be headquartered in San Diego. The deal excludes Elitech’s French sales subsidiary. The newco will have an exclusive two-year right to purchase the subsidiary for €3.5 million ($5.3 million).
Elitech also will loan Nanogen $8 million to fund its operations in the interim. In exchange, Elitech shareholders will receive senior secured promissory notes which will convert into Nanogen stock at the company’s close of $0.41 on Aug. 13, the day before the signing of the interim funding agreements. At June 30, Nanogen had $3.3 million in cash and a six-month operating loss of $14.3 million. For the fiscal year ended March 31, Elitech reported €47.5 million ($71.4 million) in revenues. The combined company expects more than $150 million in revenue in 2009. ...