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Investment Firm Ups Stake in ABI; Encourages Board to Seek 'Strategic Alternatives'

NEW YORK (GenomeWeb News) – Investment firm SAC Capital Advisors disclosed in a US Securities and Exchange Commission filing today that it has increased its stake in Applied Biosystems to 5.1 percent and that it has encouraged ABI’s board of directors to explore strategic alternatives for the firm including a possible sale.
Stamford, Conn.-based SAC and its affiliated funds have spent roughly $276.2 million over the past two months to acquire 8.6 million shares of ABI common stock, providing the firm with a 5.1 percent stake. ABI had 167,377,025 shares of common stock outstanding as of Feb. 4, according to quarterly report filed with the SEC earlier this year.
SAC noted in today’s filing that it had sent a letter to ABI’s non-management directors expressing continued support of the firm’s split with sister company Celera and their parent firm Applera. The firms hope to complete the split by the end of June, and Celera recently filed a preliminary prospectus with the SEC as part of that process.
In addition to favoring the split, SAC said that it encouraged the ABI board to take actions that ensure that “excess costs associated with the Applera parent company and the Norwalk, Connecticut headquarters are eliminated instead of being absorbed by” ABI.
SAC also wants current Applera CEO Tony White to cease being an officer or director of ABI, and wants the board to consider a sale of the company. White has yet to say what his role with ABI will be once the split from Celera takes place. ABI President and COO Mark Stevenson was named to that post in December, taking over for White, who had been interim president of ABI for a year following the departure of Cathy Burzik in 2006.
The investment group noted that it has yet to decide whether it will seek to nominate individuals to stand for election to ABI’s board at the firm’s 2008 annual meeting of stockholders.
SAC said that its future actions regarding ABI’s stock will be determined by the board’s actions in response to its suggestions, ABI’s share price, and general economic and industry conditions, among other factors.
As of Dec. 31, 2007, ABI’s largest institutional shareholder was Primecap Management, with a stake of roughly 12.2 percent.
ABI officials declined to comment on SAC’s filing or its recommendations for the board.

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