By Eric Fetters
Herald Writer
MUKILTEO — CombiMatrix Corp., a local developer of biochip technology, will be effectively spun off as its parent restructures into two publicly traded companies.
Acacia Research Corp., an Internet and media technology firm based in Newport Beach, Calif., has owned a majority of CombiMatrix since 1995.
"To maximize the potential value of our distinct businesses, we are pursuing a financial and operating structure that will allow our two businesses to grow as quickly as possible," Paul Ryan, chairman and chief executive officer of Acacia, said in a statement about the restructuring plan.
Under the plan, which hasn’t been voted on yet by stockholders, Acacia will buy the remaining interest in CombiMatrix and then trade its common stock into two new stock issues.
One will trade under the CombiMatrix name, reflecting the performance of the biotech company. The other new stock, traded under the name of Acacia Technologies, will be tied to Acacia’s media-related businesses.
Acacia also wants to transfer its majority ownership of Advanced Material Sciences Inc. to CombiMatrix. AMS holds the exclusive license to CombiMatrix’s biological processor array technology in the field of energy-related materials, including fuel cells and batteries.
If shareholders approve the plan, they will receive shares of new entities in exchange for the Acacia Research stocks they now hold.
CombiMatrix has strived to become a public company over the past two years. In November 2000, company officials filed for an initial public stock offering, with the goal of raising $100 million. That IPO application was withdrawn Monday in light of the new plan.
"I think it’s a very positive thing for CombiMatrix and the shareholders. It will give us our own identity, and it will allow us to go out and get investors," said Bret Undem, spokesman for the Mukilteo-based company. "We’re looking forward to this."
Jeff Hirschkorn, senior IPO analyst with World Financial Capital Markets, said CombiMatrix probably would have a hard time with an initial public offering in today’s climate. In the wake of the high-tech slump, most companies in the IPO market need to show profitability to attract sufficient investors.
"CombiMatrix was in registration for quite a long while, and its withdrawal represents a clear shakeout of deals in backlog," he said.
The restructuring separates Acacia subsidiaries that span two different industries. While CombiMatrix is developing biochips for use by academic researchers, pharmaceutical companies and others, Acacia specializes in media technology. It licenses V-chip technology to television manufacturers and owns technology for digital streaming and video-on-demand services.
"They’re just two different worlds," said Rob Stewart, a spokesman for Acacia.
The two new stocks could begin by trading this summer, assuming shareholders give their approval.
But the restructuring plan already is benefiting those who hold stock in Acacia. Since the first news of the plan last week, the company’s stock has risen from $9.33 a share to $11.41 as of Thursday’s close of the Nasdaq market.
You can call Herald Writer Eric Fetters at 425-339-3453
or send e-mail to fetters@heraldnet.com.
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