| From: richardred | 3/11/2008 12:13:04 PM | | | | | | SocGen's $8.5 bln rights issue oversubscribed
Tuesday March 11, 7:36 am ET
By Sudip Kar-Gupta
PARIS (Reuters) - French bank Societe Generale (Paris:SOGN.PA - News) said its 5.5 billion euro ($8.45 billion) rights issue was oversubscribed, providing a base for its battle to recover from a trading scandal that has made it a takeover target.
Investors applied for 1.84 times the number of shares on offer, the company said on Tuesday.
SocGen carried out the share issue to bolster its finances after unveiling in January 4.9 billion euros of trading losses which it blamed on rogue deals by a single trader. The scandal has made it vulnerable to a takeover bid.
The one-for-four rights issue at 47.50 euros a share was fully underwritten by JP Morgan (NYSE:JPM - News) and Morgan Stanley
(NYSE:MS - News).
SocGen shares were up 1.7 percent in early afternoon trade, slightly outperforming a 1.5 percent rise in the DJ Stoxx European bank sector (Zurich:^SX7P - News). At that price, SocGen has a stock market value of around 30 billion euros.
"It's good for the bank. The short-term problem of its capital has been solved," said Stratege Finance fund manager Valerie Cazaban, who bought rights issue shares.
BNP PARIBAS BID REMAINS IN FRAME
Many investors had bought the SocGen rights issue shares due to bid speculation surrounding SocGen. France's biggest listed bank BNP Paribas (Paris:BNPP.PA - News) has said it is looking at SocGen. BNP Paribas narrowly failed to buy SocGen in 1999.
BNP Paribas shares were up 1.4 percent, giving it a market capitalization of around 53 billion euros.
SocGen's main institutional shareholders, such as French insurers Groupama and CNP (Paris:CNPP.PA - News), all signed up to the capital increase. According to the bank's website, SocGen staff themselves hold around 7 percent of the company's share capital.
"The rights issue was a shareholder friendly mechanism. Most of the existing shareholders were not willing to get diluted and were even ready to reinforce their positions," said Emmanuel Gueroult, head of Europe, Middle East and Africa Equity Capital Markets at Morgan Stanley.
SocGen's executive chairman Daniel Bouton has repeatedly said he plans to continue running SocGen as an independent entity.
"The success of this operation will allow Societe Generale to continue its development in business and regions with high potential," SocGen said in a statement.
However, analysts and fund managers said the bank's successful execution of the rights issue would not necessarily provide a barrier to any takeover attempt.
"It doesn't really change the big picture in terms of M&A (merger and acquisition) speculation," said an analyst at a U.S. investment bank who declined to be named.
Stratege Finance's Cazaban said a bid on SocGen could happen in the near future.
"If there's a deal, it ought to take place in the forthcoming days. Otherwise, the stock will lose its speculative value," she said.
SocGen shares have fallen by around 30 percent since the start of 2008.
(Editing by Dominique Vidalon, Andrew Callus and Mike Elliott)
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| To: richardred who wrote (1737) | 3/11/2008 12:16:09 PM | | From: richardred | | | | Hexion Specialty Chemicals Reports Fourth Quarter and Fiscal Year 2007 Results
Tuesday March 11, 7:04 am ET
Fiscal Year 2007 Revenues Increase 12%, Operating Income Gains 22% (Adjusted for Fiscal Year 2006 Divestitures) and Segment EBITDA Improves by 17% on Strength of Global Customer Base and Diverse Product Portfolio
COLUMBUS, Ohio--(BUSINESS WIRE)--Hexion Specialty Chemicals, Inc. today reported its results for the fourth quarter and fiscal year ended December 31, 2007. Highlights for the fourth quarter of 2007 include:
* Revenues of $1.48 billion in 2007 compared to $1.31 billion during the prior year period, an increase of 13 percent.
* Operating income of $21 million for the fourth quarter of 2007 versus $59 million for the comparable prior year period. Fourth quarter 2007 operating income was negatively impacted by asset impairments of $24 million related to the Company’s continued site rationalizations and $16 million of manufacturing interruptions and planned facility turnarounds.
* Net loss of $63 million for the 2007 quarter versus a net loss of $55 million in the fourth quarter of 2006.
* Despite increased raw material costs, manufacturing interruptions and planned facility turnarounds, Segment EBITDA (earnings before interest, taxes, depreciation and amortization) increased 2 percent to $125 million in fourth quarter 2007 compared to $123 million during the prior year period due to improved product mix and ongoing cost reduction programs. (Note: Segment EBITDA is a non-GAAP financial measure and is defined and reconciled to Net Income later in this release).
Highlights for fiscal year 2007 include:
* Revenues of $5.8 billion, a 12 percent increase compared to fiscal year 2006. Acquisitions, net of divestitures, added $222 million in incremental sales.
* Full year operating income reached $302 million, an increase of 22 percent, compared to $247 million recorded in fiscal year 2006 after excluding gains from the sale of businesses.
* The Company posted a net loss of $65 million in 2007 compared to a net loss of $109 million in fiscal year 2006. Fiscal year 2007 results included $98 million in higher interest and tax expenses compared to the prior year period. Fiscal year 2006 results included a $121 million loss on the extinguishment of debt and a $39 million net gain from the sale of businesses.
* Hexion recorded 2007 Segment EBITDA of $611 million compared to $524 million in 2006, an increase of 17 percent. Adjusted EBITDA was $707 million for the year ended December 31, 2007. (Note: Adjusted EBITDA is a non-GAAP financial measure and is defined and reconciled to Net Income later in this release).
“Our fourth quarter 2007 Segment EBITDA was negatively impacted by $16 million in raw material inflation, $7 million in planned turnaround maintenance costs and $9 million in manufacturing outages when compared to the fourth quarter of 2006,” said Craig O. Morrison, Chairman, President and CEO. “Fortunately, our manufacturing operations have returned to normal production at this time and our pricing actions partially offset raw material headwinds in the fourth quarter of 2007. We are also working to achieve the selective pricing actions that have recently been announced, while closely monitoring the ongoing raw material volatility.”
“Our strong gains in 2007 operating income and Segment EBITDA demonstrate our success in serving our growing global customer base, achieving synergies and managing costs. I am also pleased with the improvement in our balance sheet in 2007 as we generated $174 million in cash from operations and completed two bolt-on acquisitions, while maintaining a strong liquidity position of $485 million based on cash plus available borrowing capacity under our credit facilities. Looking ahead to 2008, we will continue to focus on offsetting challenging North American market conditions through our strategy of international diversification, synergy achievement, productivity initiatives and leveraging our global footprint to better serve our customers.”
As part of its ongoing synergy program, Hexion achieved $15 million in synergies in the fourth quarter of 2007. As of December 31, 2007, Hexion has achieved $120 million in synergies from its full program targeting $175 million in savings.
During the fourth quarter of 2007, Hexion also announced that it had completed the purchase of ARKEMA GmbH, which had 2006 revenues of approximately €101 million, or $127 million. Terms of the agreement were not disclosed. Based in the Leuna industrial park in east central Germany, the ARKEMA German resins and formaldehyde business manufactures formaldehyde and formaldehyde-based resins including urea-formaldehyde, phenol-formaldehyde and melamine-based resins systems. The acquisition expands the Company’s presence in Germany, the largest wood panels market in Europe, and in Eastern Europe.
Transaction Update
Hexion recently announced that both it and Huntsman Corporation have agreed to allow additional time for the Federal Trade Commission to review the proposed merger of the two companies. As a result, the merger is not expected to be completed before May 3. To accommodate the extension, Hexion has also given notice to Huntsman that on April 5, it will exercise its option to extend the Termination Date under the Merger Agreement for 90 days, and thus, if the conditions to Hexion’s extension right are met on April 5, the termination date under the Merger Agreement will be extended until July 4, 2008.
“We are fully cooperating with regulatory agencies and will continue to work closely with Huntsman and the agencies in order to obtain the regulatory approvals required to complete the merger,” Morrison said.
Hexion announced on July 12, 2007, that it had entered into a definitive agreement to acquire Huntsman Corporation in an all-cash transaction valued at approximately $10.6 billion, including the assumption of debt. Under the terms of the Merger Agreement, the cash price per share to be paid by Hexion will increase each day beginning on April 5, 2008 through consummation of the merger at the equivalent of approximately 8% per annum (less any dividends or distributions declared or made). The transaction was approved by Huntsman shareholders on October 16, 2007 and is subject to customary closing conditions, including regulatory approval in the U.S. and several other countries.
Segment Results
Following are net sales and Segment EBITDA by reportable segment for the fourth quarter and full year 2007. Segment EBITDA is defined as EBITDA adjusted to exclude certain non-cash and non-recurring expenses. Segment EBITDA is the primary performance measure used by the Company to evaluate operating results and allocate resources among segments. Segment EBITDA is also the profitability measure used in management and executive incentive compensation programs. Corporate and Other primarily represents certain corporate, general and administrative expenses that are not allocated to the segments.
(U.S. Dollars in Millions)
(Unaudited)
Three months ended
December 31,
Fiscal Year Ended
December 31,
2007 2006 2007 2006
Net Sales to Unaffiliated Customers (1)(2)(3)
Epoxy and Phenolic Resins $ 616 $ 539 $ 2,424 $ 2,152
Formaldehyde and Forest Products Resins 448 357 1,663 1,440
Coatings and Inks 316 326 1,330 1,254
Performance Products 100
87 393 359
1,480 1,309 5,810 5,205
Segment EBITDA (2)(3)
Epoxy and Phenolic Resins $ 62 $ 66 $ 337 $ 271
Formaldehyde and Forest Products Resins 39 43 165 156
Coatings and Inks 17 11 86 81
Performance Products 20 14 77 61
Corporate and Other (13 ) (11 ) (54 ) (45 )
(1)
Intersegment sales are not significant and, as such, are eliminated within the selling segment.
(2)
Net sales and Segment EBITDA include the acquisition of the coatings business from the Rhodia Group, the global ink and adhesive resins business from Akzo Nobel, the resins and adhesives business from Orica and the forest products resins and formaldehyde business of Arkema since January 31, 2006, June 1, 2006, February 1, 2007 and November 1, 2007, respectively, and exclude the results from Alba Adesivos, the Brazilian Consumer Divestiture, since March 31, 2006.
(3)
Certain of the Company’s product lines have been realigned, resulting in reclassifications between segments. Prior period balances have been reclassified to conform to current presentations.
Earnings Call
Hexion Specialty Chemicals, Inc. will host a teleconference to discuss Fourth Quarter and Fiscal Year 2007 results on Tuesday, March 11, 2008, at 10:00 a.m. Eastern Standard Time.
Interested parties are asked to dial-in approximately 10 minutes before the call begins at the following numbers:
U.S. Participants: 866-700-5192
International Participants: 617-213-8833
Participant Passcode: 72131271
Live Internet access to the call and presentation materials will be available through the Investor Relations section of the Company’s website: www.hexion.com.
A replay of the call will be available for three weeks beginning at 12 p.m. Eastern Time, March 11, 2008. The playback can be accessed by dialing 888-286-8010 (U.S.) and 617-801-6888 (International). The passcode is 12933968. A replay also will be available through the Investors Section of the Company’s website.
Reconciliation of Segment EBITDA to Net Loss (Unaudited)
Three months ended Dec. 31,
Year ended Dec. 31
2007 2006 2007 2006
Segment EBITDA:
Epoxy and Phenolic Resins $ 62 $ 66 $ 337 $ 271
Formaldehyde and Forest Product Resins 39 43 165 156
Coatings and Inks 17 11 86 81
Performance Products 20 14 77 61
Corporate and Other (13 ) (11 ) (54 ) (45 )
Reconciliation:
Items not included in Segment EBITDA
Transaction costs — 1 (1 ) (20 )
Integration costs (10 ) (12 ) (38 ) (57 )
Non-cash charges (37 ) (9 ) (54 ) (22 )
Unusual items:
Gain (loss) on divestiture of business — (1 ) 8 39
Purchase accounting effects/inventory step-up (1 ) — (1 ) (3 )
Discontinued operations — — — (14 )
Business realignments (5 ) 6 (21 ) 2
Other (8 ) (2 ) (17 ) (10 )
Total unusual items (14 ) 3 (31 ) 14
Total adjustments (61 ) (17 ) (124 ) (85 )
Interest expense, net (73 ) (71 ) (310 ) (242 )
Loss on extinguishment of debt — (69 ) — (121 )
Income tax benefit (expense) (1 ) 27 (44 ) (14 )
Depreciation and amortization (53 ) (48 ) (198 ) (171 )
Net loss $ (63 ) $ (55 ) $ (65 ) $ (109 )
Reconciliation of Last Twelve Month Net Loss to Adjusted EBITDA
Adjusted EBITDA is defined as EBITDA further adjusted to exclude certain non-cash and certain non-recurring costs. Adjusted EBITDA also includes expected future cost savings and other adjustments permitted in calculating covenant compliance under the indentures governing certain of the Company's debt instruments and the Company's senior credit facility. Certain covenants in these agreements (i) require the maintenance of a senior secured debt to Adjusted EBITDA ratio and (ii) restrict the Company’s ability to take certain actions such as incurring additional debt or making certain acquisitions if the Company is unable to meet this ratio and also a defined Adjusted EBITDA to Fixed Charge ratio. The covenant to incur additional indebtedness and the ability to make future acquisitions requires an Adjusted EBITDA to Fixed Charges ratio (measured on a trailing four-quarter basis) of 2.0:1.0. Fixed charges are defined as interest expense excluding the amortization or write-off of deferred financing costs. Failure to comply with these covenants can result in limiting long-term growth prospects by hindering the Company’s ability to incur future indebtedness or grow through acquisitions. The Company believes that including the supplemental adjustments applied in presenting Adjusted EBITDA is appropriate to provide additional information to investors to demonstrate compliance with financial covenants and assess the Company’s future ability to incur additional indebtedness. Adjusted EBITDA and fixed charges are not defined terms under accounting principles generally accepted in the United States of America (US GAAP).
Adjusted EBITDA is not intended to represent any measure of earnings or cash flow in accordance with US GAAP and the Company’s calculation and use of this measure may differ from other companies. These non-GAAP measures should not be used in isolation or as a substitute for measures of performance or liquidity. Adjusted EBITDA should not be considered an alternative to operating income or net loss under US GAAP to evaluate the Company’s results of operations or as an alternative to cash flows as a measure of liquidity. Fixed Charges should not be considered an alternative to interest expense.
Year Ended
December 31, 2007
Reconciliation of Net Loss to Adjusted EBITDA
Net loss $ (65 )
Income taxes 44
Interest expense, net 310
Depreciation and amortization expense 198
EBITDA 487
Adjustments to EBITDA
Acquisitions EBITDA (1) 38
Transaction costs 1
Integration costs (2) 38
Non-cash charges (3) 54
Unusual items:
Gain on sale of businesses (8 )
Purchase accounting effects/inventory step-up 1
Business realignments (4) 21
Other (5) 20
Total unusual items 34
In process Synergies (6) 55
Adjusted EBITDA $ 707
Fixed charges (7) $ 274
Ratio of Adjusted EBITDA to Fixed Charges (8) 2.58
(1)
Represents the incremental EBITDA impact of the Orica A&R Acquisition and the Arkema Acquisition as if they had taken place at the beginning of the period. Also includes the impacts of in process synergies related to the Coatings and Ink acquisitions.
(2)
Represents redundancy and incremental administrative costs associated with integration programs. Also includes costs to implement a single, company-wide management information and accounting system.
(3)
Includes non-cash charges for impairments of fixed assets, stock-based compensation and unrealized foreign exchange and derivative activity.
(4)
Represents plant rationalization, headcount reduction and other costs associated with business realignments.
(5)
Includes the impact of the announced Alkyds Divestiture as if it had taken place at the beginning of the period, management fees, costs to settle a lawsuit, realized foreign currency activity and costs for unplanned plant outages.
(6)
Represents estimated net unrealized synergy savings resulting from the Hexion Formation.
(7)
The charges reflect pro forma interest expense based on interest rates at March 3, 2008 as if the Orica A&R Acquisition, the Arkema Acquisition, and the amendment of our senior secured credit facilities had taken place at the beginning of the period.
(8)
We are required to maintain an Adjusted EBITDA to Fixed Charges ratio of greater than 2.0 to 1.0 to be able to incur additional indebtedness under our indenture for the Second Priority Senior Secured Notes. As of December 31, 2007, the Company was able to satisfy this covenant and incur additional indebtedness under this indenture.
Forward Looking Statements
Certain statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, the management of Hexion Specialty Chemicals, Inc. (which may be referred to as “Hexion,” “we,” “us,” “our” or the “Company”) may from time to time make oral forward-looking statements. Forward looking statements may be identified by the words “believe,” “expect,” “anticipate,” “project,” “plan,” “estimate,” “will” or “intend” or similar expressions. Forward-looking statements reflect our current views about future events and are based on currently available financial, economic and competitive data and on our current business plans. Actual results could vary materially depending on risks and uncertainties that may affect our markets, services, prices and other factors as discussed in our 2006 Annual Report on Form 10-K, and our other filings, with the Securities and Exchange Commission (SEC). Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: economic factors such as an interruption in the supply of or increased pricing of raw materials due to natural disasters, competitive factors such as pricing actions by our competitors that could affect our operating margins, and regulatory factors such as changes in governmental regulations involving our products that lead to environmental and legal matters as described in our 2006 Annual Report on Form 10-K, and our other filings, with the SEC.
About Hexion Specialty Chemicals
Based in Columbus, Ohio, Hexion Specialty Chemicals serves the global wood and industrial markets through a broad range of thermoset technologies, specialty products and technical support for customers in a diverse range of applications and industries. Hexion Specialty Chemicals is controlled by an affiliate of Apollo Management, L.P. Additional information is available at www.hexion.com.
CONSOLIDATED STATEMENTS OF OPERATIONS
HEXION SPECIALTY CHEMICALS, INC. (Unaudited)
Three months ended December 31,
(In millions) 2007 2006
Net sales $ 1,480 $ 1,309
Cost of sales 1,308 1,143
Gross profit 172 166
Selling, general & administrative expense 104 91
Transaction costs — (1 )
Integration costs 10 12
Other operating expense, net 37 5
Operating income 21 59
Interest expense, net 73 71
Loss on extinguishment of debt — 69
Other non-operating expense, net 10 1
Loss from continuing operations before income tax,
earnings from unconsolidated entities and minority interest
(62 ) (82 )
Income tax expense (benefit) 1 (27 )
Loss from continuing operations before earnings
from unconsolidated entities and minority interest
(63 ) (55 )
Earnings from unconsolidated entities, net of taxes 1 —
Minority interest in net income of consolidated subsidiaries (1 ) —
Net loss $ (63 ) $ (55 )
Comprehensive income (loss) $ (50 ) $ 2
CONSOLIDATED STATEMENTS OF OPERATIONS
HEXION SPECIALTY CHEMICALS, INC.
Fiscal Year
(In millions) 2007 2006
Net sales $ 5,810 $ 5,205
Cost of sales 4,994 4,485
Gross profit 816 720
Selling, general & administrative expense 415 384
Transaction costs 1 20
Integration costs 38 57
Other operating expense (income), net 60 (27 )
Operating income 302 286
Interest expense, net 310 242
Loss on extinguishment of debt — 121
Other non-operating expense, net 15 3
Loss from continuing operations before income tax,
earnings from unconsolidated entities and minority interest
(23 ) (80 )
Income tax expense 44 14
Loss from continuing operations before earnings
from unconsolidated entities and minority interest
(67 ) (94 )
Earnings from unconsolidated entities, net of taxes 4 3
Minority interest in net income of consolidated subsidiaries (2 ) (4 )
Loss from continuing operations (65 ) (95 )
Loss from discontinued operations — (14 )
Net loss (65 ) (109 )
Accretion of redeemable preferred stock — 33
Net loss available to common shareholders $ (65 ) $ (142 )
Comprehensive income (loss) $ 28 $ (11 )
CONSOLIDATED BALANCE SHEETS
HEXION SPECIALTY CHEMICALS, INC.
(In millions) December 31,
2007 December 31,
2006
Assets
Current assets
Cash and equivalents $ 199 $ 64
Accounts receivable (less allowance for doubtful
accounts of $22 and $21, respectively)
874 763
Inventories:
Finished and in-process goods 418 362
Raw materials and supplies 185 187
Other current assets 78 102
Total current assets 1,754 1,478
Other assets 223 107
Property and equipment
Land 105 96
Buildings 325 276
Machinery and equipment 2,231 2,009
2,661 2,381
Less accumulated depreciation (1,046 ) (830 )
1,615 1,551
Goodwill 206 193
Other intangible assets, net 208 179
Total assets $ 4,006 $ 3,508
CONSOLIDATED BALANCE SHEETS
HEXION SPECIALTY CHEMICALS, INC.
(In millions)
December 31,
2007
December 31,
2006
Liabilities and Shareholder’s Deficit
Current liabilities
Accounts and drafts payable $ 718 $ 616
Debt payable within one year 85 66
Interest payable 54 58
Income taxes payable 47 108
Other current liabilities 342 263
Total current liabilities 1,246 1,111
Long-term liabilities
Long-term debt 3,635 3,326
Long-term pension and post employment benefit obligations 220 223
Deferred income taxes 141 142
Other long-term liabilities 138 107
Total liabilities 5,380 4,909
Minority interest in consolidated subsidiaries 12 13
Commitments and contingencies
Shareholder’s Deficit
Common stock—$0.01 par value; 300,000,000 shares
authorized, 170,605,906 issued and 82,556,847
outstanding at September 30, 2007 and December 31, 2006
1 1
Paid-in deficit (13 ) (17 )
Treasury stock, at cost—88,049,059 shares (296 ) (296 )
Accumulated other comprehensive income 174 81
Accumulated deficit (1,252 ) (1,183 )
Total shareholder’s deficit (1,386 ) (1,414 )
Total liabilities and shareholder’s deficit $ 4,006 $ 3,508
CONSOLIDATED STATEMENTS OF CASH FLOWS
HEXION SPECIALTY CHEMICALS, INC.
Year ended
December 31,
(In millions) 2007 2006
Cash flows provided by operating activities
Net loss $ (65 ) $ (109 )
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization 198 171
Loss from discontinued operations — 14
Gain on sale of businesses, net of taxes (8 ) (33 )
Write-off of deferred initial public offering costs — 15
Write-off of deferred financing fees — 27
Minority interest in net income of consolidated subsidiaries 2 4
Stock-based compensation expense 5 6
Deferred tax expense (benefit) (3 ) (18 )
Amortization of deferred financing fees 7 9
Debt redemption interest adjustment — 6
Impairments 32 12
Other non-cash adjustments 14 (3 )
Net change in assets and liabilities:
Accounts receivable (51 ) (112 )
Inventories (14 ) (56 )
Accounts and drafts payable 57 86
Income taxes payable (33 ) 15
Other assets, current and non-current 17 (3 )
Other liabilities, current and long-term 16 (7 )
Net cash used in operating activities of discontinued operations — (3 )
Net cash provided by operating activities 174 21
Cash flows used in investing activities
Capital expenditures (122 ) (122 )
Capitalized interest (1 ) (3 )
Casualty loss insurance proceeds — 2
Acquisition of businesses, net of cash acquired (130 ) (201 )
Deferred acquisition costs (101 ) —
Proceeds from the sale of businesses, net of cash sold 5 47
Proceeds from the sale of assets 14 —
Net cash used in investing activities (335 ) (277 )
Cash flows provided by financing activities
Net short-term debt borrowings (repayments) 1 13
Borrowings of long-term debt 2,405 4,471
Repayments of long-term debt (2,100 ) (3,433 )
Payment of dividends on common stock (13 ) (485 )
Proceeds from issuance of preferred stock, net of issuance costs — —
Redemption of preferred stock — (397 )
Long-term debt and credit facility financing fees (5 ) (38 )
IPO related costs — (4 )
Net cash from financing activities of discontinued operations — 1
Net cash provided by financing activities 288 128
Effect of exchange rates on cash and cash equivalents 8 9
Increase (decrease) in cash and cash equivalents 135 (119 )
Cash and cash equivalents at beginning of year 64 183
Cash and cash equivalents at end of year $ 199 $ 64
Contact:
Hexion Specialty Chemicals, Inc.
Investors:
John Kompa, +1-614-225-2223
Director, Investor Relations
john.kompa@hexion.com
or
Media:
Peter F. Loscocco, +1-614-225-4127
Vice President, Public Affairs
peter.loscocco@hexion.com
Source: Hexion Specialty Chemicals, Inc
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| To: richardred who wrote (1986) | 3/11/2008 12:17:48 PM | | From: richardred | | | | EUSA Pharma to Acquire US Specialty Oncology Company Cytogen
Tuesday March 11, 7:23 am ET
Acquisition of US Infrastructure Completes Build of EUSA's Transatlantic Commercialization Platform
US$22.6 Million Acquisition Expands EUSA's Product Portfolio
EUSA Raises Over US$50 Million to Fund Acquisition and Other Investments
DOYLESTOWN, Pennsylvania and OXFORD, England, March 11 /PRNewswire/ -- EUSA Pharma Inc ('EUSA'), a transatlantic specialty pharmaceutical company focused on oncology, pain control and critical care, today announced that it has entered into a definitive agreement to acquire all the outstanding shares of Cytogen Corporation (NASDAQ: CYTO - News) for US$22.6 million. Cytogen is a specialty pharmaceutical company with three oncology and pain control products on the American market, a specialist US sales force and an established commercial infrastructure. To meet the acquisition consideration, and fund further investments, EUSA Pharma has concurrently raised over US$50 million in an investment round, led by TVM Capital, an international venture capital firm.
"The acquisition of Cytogen is of great strategic importance for EUSA as it completes the building of our transatlantic commercialization infrastructure, as well as fitting perfectly with our focus on oncology and pain control," said Bryan Morton, Chief Executive of EUSA Pharma. "Over the last 18 months EUSA has built a strong European organization covering over 20 countries and marketing a portfolio of six specialty pharmaceuticals. Cytogen's products and US infrastructure are the ideal complement to our business, offering us the opportunity to commercialize a rapidly growing portfolio of medicines on both sides of the Atlantic."
Commenting on the acquisition, Rolf Stahel, Chairman of EUSA Pharma, said, "The acquisition of Cytogen marks a step change in the growth of EUSA and completes the foundations of a world-class specialty pharmaceutical company. This transaction will transform our business, putting in place a truly transatlantic growth platform, and positioning the company as the partner of choice for future acquisitions and specialty product in-licensing."
Strategic rationale
The acquisition of Cytogen brings to the enlarged EUSA group an established US commercial organization with a 40-strong specialist oncology sales force and three marketed products.
- Caphosol® is a supersaturated calcium phosphate rinse indicated for the treatment of oral mucositis, a common and debilitating side-effect of radiation therapy and high-dose chemotherapy, and for the treatment of xerostomia.
- ProstaScint® is a monoclonal antibody-based agent used to image the extent and spread of prostate cancer.
- Quadramet® is a radiopharmaceutical for the treatment of pain in patients whose cancer has spread to the bones.
The enlarged group will have broad sales and marketing capabilities, via direct sales forces in the US and across Europe, and through distribution partners in a number of territories including Canada, South America and Asia. EUSA will have a portfolio of nine marketed medicines and five late-stage development products. The acquisition of Cytogen provides EUSA with the capabilities to commercialize a number of these medicines on both sides of the Atlantic.
In addition, the enlarged group's transatlantic infrastructure provides the company with a strategic growth platform to exploit additional products through acquisition and in-licensing. With its highly focused business model, EUSA will have the opportunity to compete effectively with major players, making it an attractive partner for companies seeking specialist transatlantic commercial and late-stage development expertise.
Transaction details
Under the terms of the all-cash merger agreement Cytogen shareholders will receive US$0.62 per share, representing a 35% premium on the company's share price at the close of trading on 10 March 2008, and valuing the company at US$22.6 million.
The Cytogen Board has approved the cash merger agreement and resolved to recommend that the company's shareholders adopt the agreement. Completion of the acquisition is conditional on the approval of a majority of Cytogen's shareholders and fulfillment of certain pre-closing conditions. Upon completion, EUSA intends to apply to delist all Cytogen's issued shares from the NASDAQ stock exchange.
To meet the consideration for the acquisition, provide working capital to integrate and refocus the Cytogen organization and undertake further investments, EUSA Pharma has raised over US$50 million in an investment fundraising. This investment round, which is conditional on the completion of the Cytogen acquisition, is led by TVM Capital and supported by EUSA's existing investors, Essex Woodlands, 3i, Goldman Sachs, Advent Venture Partners, SV Life Sciences, NeoMed and NovaQuest.
Financial position
During 2007, Cytogen's revenues totaled US$20.2 million, with the company making a net loss of US$25.7 million for the year. At the end of December 2007 the company held cash and cash equivalents totaling US$8.9 million. During 2007, Cytogen began a program to refocus its strategy, reduce costs and promote its products more effectively by building on its expertise in the oncology field. EUSA intends to accelerate this initiative and rapidly drive the business to profitability, while retaining the strengths of the Cytogen organization.
About EUSA Pharma Inc
EUSA Pharma is a rapidly growing transatlantic specialty pharmaceutical company focused on in-licensing, developing and marketing late-stage oncology, pain control and critical care products. The company currently has six products on the market, including the antibiotic surgical implant Collatamp® G, Erwinase® and Kidrolase® for the treatment of acute lymphoblastic leukemia, and Rapydan®, a rapid-onset anesthetic patch which recently received Europe-wide approval. EUSA also has several products in late-stage development, notably Collatamp® G topical, a gentamicin impregnated collagen sponge for the prevention and treatment of infected skin ulcers, and CollaRx® bupivacaine implant(i) for local post-surgical pain control.
Founded in 2006, EUSA Pharma is supported by a consortium of leading life science capital investors, comprising TVM Capital, Essex Woodlands, 3i, Goldman Sachs, Advent Venture Partners, SV Life Sciences, NeoMed and NovaQuest. Since its foundation, the company has raised over US$225 million in addition to the fund raising announced today, and completed several significant transactions, including the acquisitions of Talisker Pharma Ltd, the French biopharmaceutical company OPi SA and the European antibiotic and pain control business of Innocoll Pharmaceuticals Inc. As part of its rapid growth strategy the company has established commercial infrastructure in the US, a pan-European presence covering over 20 countries and a wider distribution network in a further 25 territories. EUSA Pharma plans to continue its aggressive program of acquisitions and in-licensing within its specialist areas of medical and geographic focus, in line with its ambitious target to create a rapidly growing US$1 billion company by the beginning of the next decade.
For more information please visit eusapharma.com.
(i) CollaRx® is a registered trademark of Innocoll Technologies Ltd.
TVM Capital
TVM Capital, founded in 1983, is one of the first venture capital firms formed in Germany and was an early entrant into the US market in 1986. Since inception, TVM Capital has raised more than EUR 1.3 billion in six fund generations and has established itself as a leading international technology and life science investment group. TVM Capital funds have made investments in more than 235 technology and life science companies including emerging technology sectors such as energy efficiency, renewable energy generation, energy storage and water treatment. Over the life of the firm, TVM Capital has developed specialized, focused teams and dedicated funds to serve high-growth target markets. The TVM Capital investment strategy is to create global businesses that enjoy worldwide access to science, technology, management talent and capital, and to develop them into significant players in their markets. More than 50 TVM Capital backed companies have gone public on European or US stock exchanges. Today, TVM Capital is actively invested in 70 companies.
For more information please visit: tvm-capital.com.
Contacts:
Bryan Morton
Chief Executive
EUSA Pharma
Tel: +44(0)1865-784255
Rob Budge
RJB Communications
Tel: +44(0)1865-760969
Mobile: +44(0)7710-741241
Source: EUSA Pharma Inc
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| To: wherry who wrote (1216) | 3/11/2008 12:22:08 PM | | From: richardred | | | | Snip>Chevron eyes liquid natural gas growth after 2010
By Steve Gelsi, MarketWatch
Last update: 12:13 p.m. EDT March 11, 2008
NEW YORK (MarketWatch) -- Chevron on Tuesday touted growth in its natural gas production through the next decade and said it has plenty of crude oil projects over the next five years to hit its long-term production goal, as it moved to counteract a dip last year in crude oil reserves.
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| To: richardred who wrote (1711) | 3/11/2008 12:44:30 PM | | From: richardred | | | | DSCP-Bingo for the other half. :+ ). Very specialized business left. Now if they can attract a buyer for the rest. Maybe why the directors added shares of late through options exercise.
UPDATE 2-China's Mindray buys Datascope unit for $202 mln
Tue Mar 11, 2008 10:57am EDT
By Kirby Chien
BEIJING, March 11 (Reuters) - China's top maker of medical devices, Mindray Medical (MR.N: Quote, Profile, Research), said it agreed to buy Datascope Corp's (DSCP.O: Quote, Profile, Research) patient monitoring business for $202 million in cash to help it expand in the United States and Europe.
Mindray Medical International Ltd has sought acquisitions outside China for some time to increase its global presence.
Li Xiting, president and co-chief executive of Mindray, said the deal would leverage the firm's research and development and Datascope's strong U.S.-based direct sales and service network.
The deal is expected to contribute positively to Mindray's financial position in 2009 and be completed in the second quarter of 2008, pending approval from the U.S. government.
"This is very important for our business expansion in Europe and the U.S.," Li told Reuters in a telephone interview after the deal was announced. "It will transform Mindray from a largely China-based company into a global leader".
Mindray will keep the management team at the Datascope Corp (DSCP.O: Quote, Profile, Research) unit largely intact, as the two firms have cooperated for five years and know each other well, said Li.
"This is a very good fit," he said from Mindray's headquarters in Shenzhen, in southern China near Hong Kong. Continued...
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UPDATE 2-China's Mindray buys Datascope unit for $202 mln
Tue Mar 11, 2008 10:57am EDT
Mindray said the deal would add to its earnings per share on a non-GAAP basis starting in 2009, and provide cross-selling opportunities for its medical imaging systems.
The combined business will offer over 50 products across its three segments -- patient monitoring and life support products, in-vitro diagnostic products and medical imaging systems.
While the acquisition has been approved by boards' of both Datascope and Mindray, it must still pass the scrutiny of the Committee on Foreign Investment in the United States (CFIUS).
Bain Capital Partners and China's Huawei Technologies Co Ltd's [HWT.UL] failed to win CFIUS approval for their $2.2 billion acquisition of U.S. network equipment maker 3Com Corp (COMS.O: Quote, Profile, Research) last month due to national security questions.
Huawei's secretive founder Ren Zhengfei, and his background as a former People's Liberation Army soldier and continued ties to China's military establishment, weighed on the deal.
"We do not see any obstacles for approval by CFIUS," said Li.
Datascope Corp (DSCP.O: Quote, Profile, Research) said the deal would produce net cash proceeds of about $185 million after taxes and expenses, while its earnings per share in fiscal 2009 will be essentially unchanged as a result of deal.
The unit had total revenues of $161.3 million in calendar year 2007, approximately the same as those generated from Mindray's home China market. (Additional reporting by Esha Dey in Bangalore) (Editing by Mike Elliott and Vinu Pilakkott))
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| To: richardred who wrote (1995) | 3/12/2008 12:51:54 AM | | From: richardred | | | | Chinese Medical Firm Buys Into U.S.
By NICHOLAS ZAMISKA
March 12, 2008; Page A4
HONG KONG -- Mindray Medical International Ltd., one of China's top medical-device makers, will acquire Datascope Corp.'s patient-monitoring business for $202 million, as the company strives to become an international player.
The deal between Mindray, of Shenzhen, China, and Datascope, of Montvale, N.J., comes as Chinese health-care companies increasingly look to overseas markets to build on profits made on low-cost manufacturing at home.
The purchase of the Datascope business, which had revenue of $161.3 million last year, will give Mindray access to Datascope's network of sales and service representatives, some 90 people who peddle the company's products to hospitals and surgery centers across the U.S. Building that kind of network from scratch would have been a challenge, said Joyce Hsu, Mindray's chief financial officer.
"We will be able to acquire a very large and established sales and distribution network in the U.S.," she said in an telephone interview yesterday.
Datascope wasn't available to comment.
Mindray, founded in 1991, makes patient monitors, blood analyzers, ultrasound equipment and other devices.
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| To: richardred who wrote (1987) | 3/13/2008 12:15:16 PM | | From: richardred | | | | Electronic Arts Goes Hostile on Take-Two
Thursday March 13, 12:00 pm ET
Electronic Arts Takes Its Unsolicited $2B Bid for Take-Two to Its Rival's Shareholders
REDWOOD CITY, Calif. (AP) -- Video game maker Electronic Arts Inc. said Thursday that it has launched a hostile $2 billion tender offer for rival Take-Two Interactive Software Inc., the publisher of "Grand Theft Auto" and other video games.
The move takes the offer directly to Take-Two's shareholders after Take-Two rejected the offer late last month.
At the time, Take Two had said it was open to talks with Electronic Arts but wanted to wait until April 30, the day after the latest version of Grand Theft Auto hits store shelves.
The $26 per share cash tender offer from an Electronic Arts' subsidiary represents a 4 percent premium to Take-Two's closing stock price of $24.91 on Wednesday and a 64 percent premium to the company's Feb. 15 closing stock price, which was the last trading day prior to Electronic Arts' revised offer.
The tender offer, which is not contingent on financing, is set to expire at midnight on April 11, unless extended. Take-Two's annual shareholders' meeting is expected to take place on April 10.
Take-Two shares rose 53 cents, or 2.1 percent, to $25.44 in midday traduing, while Electronic Arts shares dropped 69 cents, or 1.5 percent, to $46.54.
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| To: richardred who wrote (1909) | 3/13/2008 12:20:47 PM | | From: richardred | | | | AOL Buying Bebo for $850 Million
Posted Mar 13, 2008 09:57am EDT by Robert Andrews in Investing, Internet, Venture Capital, M and A, IPOs
Related: twx, nws, goog, via, yhoo
From paidContent.org, March 12, 2008:
In a major and rather unexpected deal, AOL (NYSE: TWX) is buying social net Bebo for $850 million in cash. Rumors had swirled around Bebo of either an acquisition or new financing for weeks, but few anticipated AOL as the suitor. AOL will get Bebo’s 40 million members and 80 million unique users, its core 13-to-24 demographic and a growing line in both original TV production and hosting broadcasters’ content. This comes as AOL completes its transition from an access business to an ad-funded content and community player.
Bebo president Joanne Shields, who has grown to effectively run Bebo from London since she was hired from Google (NSDQ: GOOG) in January ‘07, “will continue to run Bebo and will report to Ron Grant”, the announcement says. But there’s no mention of site founders Michael or Xochi Birch, who are based in what is technically Bebo’s headquarters in San Francisco. Shields is not in the UK today and will be on a joint AOL-Bebo call at 9am EST.
AOL CEO Randy Falco: “Bebo is the perfect complement to AOL’s personal communications network and puts us in a leading position in social media. What drew us to Bebo was its substantial and fast-growing worldwide user-base, its vision of a truly social web, and the monetization opportunities that leverage Platform-A (AOL’s ad system) across our combined global audience. This positions us to offer advertisers even greater reach and marketers significant insights into the desires and needs of consumers.” Shields says the acquisition is “a natural progression” for Bebo because the pair share “one and the same vision in this area” of leveraging social networks.
- Suitors: This price is considerable when you consider News Corp (NYSE: NWS) paid $580 million for MySpace in 2005, when it had 27 million unique monthly users. In the last couple of months, rumors had linked Google and News Corp to a potential acquisition, but this buy is far less than the unlikely $1 billion recently mooted. Rupert Murdoch was reportedly spotted at Bebo in SF in January with a view to either buy or invest, but its press people explained the apparent untruth away to me as office high jinx, adding it’s “always open to talks” on funding. Viacom (NYSE: VIA) was also linked with a $750 million purchase.
- Advertising: Bebo claims high user engagement, with an average 78 pages per user per day, and 33 minutes. But Yahoo (NSDQ: YHOO) inked a deal with Bebo in September to manage the social net’s UK and Ireland display and video ads as well as integrate its Yahoo Answers platform - it will be interesting to see whether AOL’s Platform-A will now oust Yahoo as the ad supplier, and this brings ongoing Yahoo-AOL discussions in to sharp relief.
Curiously, AOL used the announcement to tout its Open AIM instant messenger initiative - curious because Bebo already added AIM support to its Windows Live Messenger functionality in October.
Bebo is especially popular in the UK, Ireland and New Zealand and has over 100 staff across its London, San Francisco and Austin offices. No word yet on whether Bebo will stay put or move to AOL’s HQ.
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| To: richardred who wrote (1893) | 3/13/2008 12:39:58 PM | | From: richardred | | | | York Label Acquires Etiprak, S.A. and Etiquetas Industriales, Ltda.
Thursday March 13, 12:03 pm ET
OMAHA, Neb., March 13 /PRNewswire/ -- York Label announced Tuesday, March 11, it has acquired Etiprak, S.A. through its Cameo-Marinetti joint venture, and a 50% interest in Etiquetas Industriales Ltda., both located in Santiago, Chile.
These Chilean acquisitions provide the platform for York Label to continue its aggressive expansion path to become a global provider of premium and innovative labeling solutions. Combined with our existing Cameo-Marinetti joint venture, these acquisitions create the largest single provider of label products in the Chilean market.
Founded in 1982, Etiprak was the first Chilean company to produce pressure sensitive labels for the wine industry. Recognized for its high quality products and tremendous customer service reputation, Etiprak focuses primarily on the wine & spirits and consumer products markets, its customers include several major Fortune 100 Companies. In 2007, the company began the manufacturing of decorative shrink sleeve labels. Etiprak employs state-of-the-art equipment and technology which features high-end combination flexo, screen, foil stamping, embossing and laminating.
Etiquetas Industriales produces premium pressure sensitive labels primarily for the consumer products market. Launched in 2006 by Marinetti Packaging, the company employs the latest cutting edge manufacturing technologies and provides York Label entry into the South American consumer products market.
Rich Egan, President and CEO of York Label stated, "We are extremely pleased to announce the acquisition of Etiprak and Etiquetas Industriales. These new partnerships provide York Label a commanding leadership position in the Chilean wine & spirits market. We expect to continue executing our strategy to expand our platform to become a preeminent global provider of premium labeling solutions to the consumer products, wine & spirits, pharmaceutical, and food & beverage markets."
About York Label (http://www.yorklabel.com)
Omaha, Nebraska based York Label is a leading provider of high quality, innovative labeling technologies to major global consumer goods, wine & spirits, pharmaceutical and food & beverage companies. The Company has thirteen state-of-the-art production facilities with over 800 employees throughout North and South America.
Source: York Label
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