Feb. 13, 2003 — Caliper Technologies Corp. has rejected an acquisition offer announced Wednesday by a New York firm that buys distressed public companies.
In a written statement, the California-based lab-on-a-chip developer said its board of directors reviewed the proposal and believed it was not in the best interests of Caliper’s shareholders. LB Acquisitions, a wholly owned subsidiary of Little Bear Investments LLC, seeks to buy Caliper for its cache of more than 100 patents. LB submitted a plan Tuesday to Caliper’s board of directors to buy the company for $4.15 per share of its common stock.
“(Caliper) is burning $35 million a year; that overhead is unsustainable,” said Zachary Prensky, LB’s controlling owner. “I believe that given the market opportunities that face Caliper, the overhead of the company and its associated R&D budget are unsustainable. Our offer is in the best interests of all shareholders.” Prensky, along with family members and other partners, has bought 180,000 shares of Caliper stock.
If the acquisition is carried out, Prensky said, his firm plans to create a trust containing $5 million to hold all of Caliper’s IP. The trust would collect royalties and oversee attempts to license the technology or any patent litigation. Caliper shareholders would receive one unit of the trust for every five shares of Caliper stock owned.
“We call it ‘circling the runway’ while the market for microfluidics and related technologies develops and matures,” he said.
The deal is subject to the investment firm obtaining financing and completing due diligence. LB said it does not intend to engage in proxy solicitation, which involves garnering support for the deal through direct contact with shareholders, but reserves the right to do so if Caliper’s board rejects the offer.
Little Bear Investments announced last week it had changed its name from Zackfoot Investments LLC. Zackfoot specialized in investing in privately held companies in the New York region.
Caliper, which trades on Nasdaq, closed at $3.19 Wednesday, up from $3 Tuesday.