Epoch delays merger decision
Published 9:00 pm Wednesday, December 8, 2004
BOTHELL – Epoch Biosciences of Bothell delayed a decision Wednesday on its buyout by Nanogen Inc. after Nanogen couldn’t round up votes from a majority of its shareholders.
Both biotechnology companies said they still expect the acquisition to take place despite the glitch. Of the votes tallied by both Epoch and Nanogen, more than 90 percent favored the merger, said Bert Hogue, Epoch’s chief financial officer.
New shareholder meetings have been scheduled for Wednesday.
Nanogen announced its intention to buy Epoch in September. The companies, which have collaborated on research in the past, make similar molecular-testing tools. Under the terms of the all-stock deal, Epoch’s sale would bring about $83 million to its investors.
Hogue said a majority of shareholders at his company’s meeting were represented, but they agreed to adjourn until next week when it was clear Nanogen couldn’t take its vote.
It was easier for Epoch to gather a majority of its shareholders for a vote than it was for Nanogen, Hogue explained. Epoch has about 29 million outstanding shares, compared with 34 million for Nanogen.
“Nanogen’s shareholder base is substantially different than ours. They have a much larger number of shareholders, including many more individual shareholders,” he said.
Nanogen representatives couldn’t be reached. When its meeting began in San Diego, where Nanogen has its headquarters, the company had received votes representing 16.4 million shares, about 300,000 shares short of a voting majority.
Assuming the required number of affirmative votes are tallied at next week’s meetings, the acquisition could be completed by the following day, Hogue said.
Nanogen plans to merge Epoch’s administrative and sales operations with its own in San Diego, which is expected to result in some job losses in Bothell.
But Epoch’s research and development and manufacturing operations, where the majority of Epoch’s 40 employees work, will remain here. Hogue and Epoch’s chief executive officer, William Gerber, would leave the company.
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
