Transgenomic Inc has closed the acquisition of Clinical Data Inc’s diagnostic business with a sales price of $15.5 million. In addition, the company has closed on $6.0 million of financing from Third Security LLC to fund the cash portion of Transgenomic’s acquisition of Clinical Data’s diagnostic business. This strategic acquisition provides Transgenomic with proprietary genetic commercial tests that have an established revenue base, proprietary biomarker assays, an additional CLIA-certified laboratory operation, and established test reimbursement and coverage policies that offer access to testing for an estimated 280 million patients.
Under the terms of the financing with Third Security, Transgenomic has issued an aggregate of 2,586,205 shares of the company’s newly created Series A convertible preferred stock to certain affiliates of Third Security for an aggregate purchase price of $6.0 million. Additionally, the Transgenomic issued such affiliates of Third Security warrants to purchase an aggregate of up to 1,293,102 shares of Series A preferred stock at an exercise price of $2.32 per share. The Series A preferred shares issuable pursuant to the purchase agreement and upon exercise of the warrants are convertible into shares of the company’s common stock at a conversion price of $0.58 per share, for an aggregate of 15,517,228 million shares of common stock. Upon full exercise of the warrants, Transgenomic will receive approximately $3.0 million.
Commenting on the acquisition of Clinical Data’s diagnostic business, Craig Tuttle, Chief Executive Officer of Transgenomic, said, "We are very excited about the acquisition, which strengthens our molecular diagnostics position in the marketplace, expands our commercial operation with an accomplished team that will improve our competitive position, and enhances our customer support and patient care capabilities. We are also very excited about building a strategic relationship and having the support of such a respected investor as Third Security and Randal Kirk. Their knowledge of our industry will be beneficial in catapulting Transgenomic into the top tier of diagnostic providers."
Griffin Securities Inc acted as financial adviser and placement agent to Transgenomic, Inc on this transaction.
Source: Transgenomic Inc