Cti Molecular Imaging (NASDAQ:CTMI)
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CTI Molecular Imaging, Inc. Announces Definitive Agreement for
Acquisition of Concorde Microsystems
Transaction Will Strengthen Capabilities to Serve the Medical Research Market
and Drive New PET Biomarker Development
KNOXVILLE, Tenn., June 20 /PRNewswire-FirstCall/ -- CTI Molecular Imaging,
Inc. (NASDAQ:CTMI), a leading provider of positron emission tomography (PET)
equipment, molecular imaging biomarkers and services, today announced a
definitive agreement for the acquisition of Concorde Microsystems, Inc.
Concorde Microsystems is the leading provider of small animal PET systems for
imaging laboratory animals used in medical research. After closing, the
acquisition will increase the capabilities of CTI Molecular Imaging to broadly
serve the research and pharmaceutical markets, where CTI already has many
existing relationships to supply research isotopes and PET expertise to several
world-class pharmaceutical companies. In combination with its PETNET national
network of radiopharmacies, CTI Molecular Imaging intends to leverage the
acquisition of Concorde to accelerate the discovery of new molecular imaging
biomarkers for the clinical market.
"Concorde Microsystems has developed the premier technology for performing PET
studies on laboratory animals used in basic and medical research. Concorde has
the leading franchise in a market with tremendous growth opportunities. Their
hardware systems are an excellent complement to the PET isotopes that we offer
our research customers," said Thomas J. Hook, President of CTI Solutions and
Senior Vice President of CTI Molecular Imaging.
"More importantly, this is another step in CTI Molecular Imaging's evolution
toward a focus on developing new molecular probes and biomarkers for the
diagnostic market. We intend to augment our own internal development of these
compounds through partnerships with the leading pharmaceutical research
organizations in the world," continued Hook. "We want to strengthen our role
as the leading supplier to the research market of important molecular imaging
know-how, and the completion of this acquisition will solidify our position
significantly."
Concorde Microsystems has a broad customer base in medical research, with an
estimated market share of greater than 80%. The National Cancer Institute's
(NCI) Small Animal Imaging Resource Program (SAIRP) grants research funding
with an emphasis on molecular and genomics imaging of cancer in-vivo. Of the
ten research institutes participating in SAIRP, seven utilize at least one or
more Concorde microPET(R) systems.
"Concorde has chosen to join CTI Molecular Imaging because of its unique
capabilities in molecular imaging," said Robert Nutt, President and Chief
Executive Officer of Concorde Microsystems. "CTI's resources in PET technology
and new biomarker development make it the best positioned company to capitalize
on the promise of molecular medicine, and Concorde can help to further CTI's
leadership in this endeavor."
The transaction is structured as an asset purchase and is expected to close on
June 30, 2004. The total consideration paid in connection with this
acquisition is $41 million in cash and unregistered shares of CTI's common
stock, plus the potential for incentive payments that are contingent upon the
future financial performance of Concorde Microsystems. Due to the related-
party nature of the acquisition, the transaction was reviewed by the Audit
Committee of CTI's Board of Directors and was considered and approved only by
independent board members. Piper Jaffray provided its opinion to the
independent members of the Board of Directors as to the fairness, from a
financial point of view, to CTI of the consideration to be paid in the
transaction. Concorde Microsystems is partially owned and operated by the
children of Ronald Nutt, Ph.D., the President and CEO of CTI Molecular Imaging.
CTI does not anticipate a significant charge for in-process research and
development expenses at Concorde. The transaction is expected to be dilutive
to CTI Molecular Imaging's earnings results in the fiscal fourth quarter of
2004 by $0.01 and neutral to earnings results in fiscal 2005.
About CTI Molecular Imaging:
CTI Molecular Imaging, Inc. is a leading supplier of products and services for
positron emission tomography (PET), a diagnostic imaging technology used in the
detection and treatment of cancer, cardiac disease and neurological disorders.
Additional information is available at: http://www.ctimi.com/ .
About Concorde Microsystems:
Concorde Microsystems is the leading supplier of microPET(R) dedicated small
animal PET scanners. MicroPET(R) provides researchers in the biomedical
sciences with a compact and very high performance PET system that can be used
to non-invasively image a wide range of laboratory animals in a routine
laboratory setting. Additional information is available at:
http://www.cms-asic.com/ .
Certain matters discussed in this press release constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements may be identified by words such as
"believe," "assume," "expect," "anticipate," "intend," "estimate" or similar
expressions, and include any statements that necessarily depend on future
events, such as CTI's expectations about whether and when the acquisition of
Concorde Microsystems will close, the effect of any charges that will be taken
in connection with the acquisition and the impact of the acquisition on CTI's
financial results. Forward-looking statements involve a number of risks and
uncertainties and there can be no assurance that any forward-looking statements
will prove to be accurate. Various factors could cause actual results to
differ materially from those anticipated in the forward-looking statements.
For example, the closing of the acquisition of Concorde Microsystems is subject
to a number of closing conditions, including conditions that are beyond CTI's
ability to control, such as the receipt of certain consents from third parties
the satisfaction of certain due diligence requirements, and the continued
accuracy of certain representations, warrants and covenants made to CTI by
Concorde. In addition, the impact of such acquisition on CTI's financial
results will depend upon a number of uncertain events, such as the successful
integration of the two businesses and CTI's ability to achieve certain
anticipated efficiencies associated with combining business operations. CTI
undertakes no obligation to update or revise any forward-looking statements.
Further information regarding risks, uncertainties and other factors that could
adversely affect CTI or cause actual results to differ materially from those
anticipated in forward-looking statements are included in CTI's Annual Report
on Form 10-K for the fiscal year ended September 30, 2003 and Quarterly Reports
on Form 10-Q for the quarters ended December 31, 2003 and March 31, 2004.
DATASOURCE: CTI Molecular Imaging, Inc.
CONTACT: Michael A. Lawless of CTI Molecular Imaging, Inc.,
+1-865-218-2000
Web site: http://www.ctimi.com/
http://www.cms-asic.com/