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APB to Proceed with IPO Despite Market Conditions, ABI Warning

NEW YORK, March 22 – Nycomed Amersham is continuing with its plans to launch an initial public offering of shares in its subsidiary Amersham Pharmacia Biotech on the Nasdaq this spring, despite the downturn in the economy and a warning from competitor Applied Biosystems, the company said Thursday.

“As far as the IPO goes, we continue to work through the normal process with the SEC in filing our registration statement,” Tracy Cheung, vice president of investor relations at AP Biotech, told GenomeWeb.

The company is planning to sell 18.2 million shares, or 10 percent of the company's equity, at between $15 and $17 a share. Cheung noted, however, that the pricing structure could change as could the company's plans for the IPO, adding that the final decision would be “subject to market conditions.”

Amersham's comments follow Wednesday’s announcement from AP Biotech competitor Applied Biosystems that its short-term growth would be slowed by drop-offs in orders from customers for its instruments due to the downturn in the economy.

Michael Hunkapiller, president of Applied Biosystems, said the company’s short-term growth rate would be one half to two-thirds of its expected long-term growth rate of 20 percent.

The effects of the announcement reverberated on Wall Street Thursday. Applied Biosystems' shares were down a sharp 45 percent, at $18.80 in late morning trading, compared with Wednesday's close of $34.45. Nycomed Amersham’s shares had also dropped over 10 percent to $30.25, down from Wednesday's close of $33.75. 

Cheung said, however, that AP Biotech’s short-term forecast still looked strong.

“We did say at the end of February that AP Biotech had made a good start for the year and that we should continue to see the benefits, partly as results of delayed sales from December, and that we should also see the benefits of new product launches this quarter," she said.   

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