NEW YORK, Dec. 18 - Genomic Solutions said on Tuesday that its shareholders have approved the firm's acquisition of Cartesian Technologies.
Genomic Solutions, like many in the industry, is struggling to regain financial footing following the attacks on the US on Sept. 11, and is betting that snagging the automation tools developer will help it bounce back.
"We believe the acquisition of Cartesian will create greater stockholder value, with enhanced potential for earnings and revenue growth," Jeffrey S. Williams, president and CEO of Genomic Solutions, said in a statement. "The goal of the corporation … is to achieve positive earnings in early 2002, and remain a profitable enterprise thereafter."
The combined company is expected to post $33 million in revenues in 2002.
Although it's waiting until mid-January to release its fourth-quarter and year-end earnings, Genomic Solutions said it expects to post between $30 million and $36 million in revenue next year and rack up earnings before interest, taxes, depreciation, and amortization between $800,000 and $2.8 million. The company also said it expects earnings to break even during the first three months of the new year and break into the black three months after that.
It'll be welcome news to investors and customers. Last month, the struggling microarray and proteomics company said its third-quarter 2001 revenues slipped 28 percent to $3.6 million, compared with $5 million in the year ago period.
What's more, during the third quarter, Genomic Solutions, which recently announced a massive restructuring plan, posted a net loss of $7.9 million, or 32 cents a share, compared with a loss of $869,000, or three cents a share in the year-ago period.
"Our restructuring initiative to reduce operating expenses by 35 percent is proceeding as planned and is expected to be completed by the end of January 2002," Williams said in November when it reported its third-quarter earnings.
Over the past several months, Genomic Solutions has relocated a manufacturing facility based in Lansing, Mich., to a site near the company's headquarters in Ann Arbor, according to a spokeswoman. The relocation is expected to be completed by mid-January. Williams has said that step would help stem operating costs and preserve cash reserves, which totaled $18.6 million at the end of the third quarter, down from $40.2 million at the end of 2000. The acquisition of Cartesian is to nudge that process along, he added.