NEW YORK (GenomeWeb News) — Invitrogen plans to sell its BioReliance unit to Avista Capital Partners for $210 million as part f Invitrogen’s ongoing plan to better organize its acquired components, the companies said late yesterday.
Separately yesterday, Invitrogen reported weak fourth-quarter revenue growth as R&D spending decreased 7.6 percent and net income dropped 300 percent on a variety of one-time charges.
Invitrogen CEO Greg Lucier said the divestiture will allow the company to “focus on our platform of scientific technologies.”
BioReliance is a contract services business offering contract lab services to pharmaceutical companies. Rockville, Md.-based Avista said it expects the sale to close some time during the second quarter.
Last April, Invitrogen divested the German unit of the business, saying it was not in line with the company’s strategies, but maintained the US segment, which is also based in Rockville.
Total receipts for the three months ended Dec. 31, 2006, rose 1.6 percent to $329.8 million from $325.2 million year over year.
R&D spending increased to $35.3 million from $27.4 million year over year.
The company said net loss totaled $100.2 million from a net gain of $49.6 million in the year-ago period. The company said a variety of one-time charges affected the earnings.
Invitrogen said it had around $380.3 million in cash and equivalents and short-term investments as of Dec. 31, 2006.
"Although we had improved financial performance in the fourth quarter of 2006, we still have work in front of us to accelerate organic growth and optimize operating margins,” Invitrogen CFO David Hoffmeister said in a statement.
In addition to the sale of the company’s BioReliance division, Invitrogen said earlier this month it sold its BioSource Europe unit to a group of private investors in Belgium.
Invitrogen has described difficulties integrating past acquisitions such as Zymed, Biosource, and Caltag, and has identified these units as key reasons for its flagging financials over the past few quarters.
“In 2006, with any company that did as much as we’ve done in the last 3-and-a-half years, we clearly stumbled,” Lucier said last month at an investor conference. “We also did a number of integrations with all those companies that we acquired over the last few years.
"In 2006, the real crunch in terms of heavy lifting of closing plants, moving production lines, and consolidating them into a few of the remaining campuses took place,” he added.