Integrated BioPharma, Inc. Implements Repositioning Program
Upon completion of this transaction, which cannot be assured, the Company expects to save approximately $2.0 million per annum that would otherwise be spent to support the growth and further development of the Pharmaceutical Segment.
16/09/08 Integrated BioPharma, Inc., has announced the implementation of the Company's repositioning program to focus singularly on its historic expertise and success in the nutraceutical field. On August 18, 2008, the Company completed a sponsored spin-off of its subsidiary, iBioPharma, Inc., through a stock dividend of its shares of iBioPharma to the Company's stockholders and immediately thereafter effecting a $5.0 million placement of shares of iBioPharma. This will eliminate approximately $3.0 million in expenses that the Company would otherwise be required to account for and fund in each of the next few years and will allow iBioPharma to obtain capital directly from investors whose knowledge and return requirements are reconcilable with biotechnology investment.
In conjunction with the spin-off, all of the holders of the Company's $6.0 million of Series C Convertible Preferred Stock elected to convert their preferred shares into common stock of the Company, thereby eliminating approximately $1.0 million in annual preferred dividends and terminating the various preferences they held over the common stock. In addition, insiders of the Company exercised stock options previously granted to an extent that resulted in the contribution to the Company's capital and cash of $1.4 million.
The Company has engaged advisors to assist it in the sale or strategic partnering of its Pharmaceutical Segment in Colorado. Upon completion of this transaction, which cannot be assured, the Company expects to save approximately $2.0 million per annum that would otherwise be spent to support the growth and further development of the Pharmaceutical Segment.
"We are now free to focus our capital and management entirely on our core business -- nutraceuticals -- where we have positive experience and important distribution relationships," said E. Gerald Kay, Chairman and Chief Executive Officer of the Company. "We feel we are now in an excellent position to capitalize on our new product line that is currently being introduced in our distribution channels this month."
