Kirchner and Company Inc. has been engaged as investment advisor and agent to Warnex Inc.
Laval, Quebec, 11 December 2006 – Warnex Inc. (TSX: WNX) today announced that it has decided to explore strategic alternatives for its pathogen detection business including partnerships, joint ventures or the sale of this business, in order to enhance shareholder value. The Company has mandated a U.S.-based investment banking firm, Kirchner & Company, Inc., to act as its agent in this process.
“We take considerable pride in the technology we have developed and believe that our system is the best food safety technology available. Ensuring the pathogen detection system achieves its full commercial potential, however, ultimately requires a wider distribution platform than we can provide. Therefore, in order to ensure its long-term success, we have decided to explore strategic alternatives for this part of our business,” said Mark Busgang, President and CEO of Warnex. “Looking forward, our goal is to be focused on our laboratory services divisions. Our analytical, bioanalytical and medical laboratory divisions have always been profitable and have generated a strong 5-year compound annual revenue growth rate of 43%. With two acquisitions completed in 2006, we are looking forward to strong organic growth as well as additional acquisitions in the profitable laboratory services sector.”
The Warnex(TM) Rapid Pathogen Detection System, based on real-time PCR technology, offers a versatile detection and quantification platform that provides accurate results within 3 to 48 hours, a significant improvement over traditional microbiology tests that require 5 to 7 days. This business, which is based on a recurring revenue model, has realized over 60% growth in reagent revenues in the last year. With three European distributors, an initial customer base in North America and a strategic alliance with Eppendorf, a global leader in the laboratory equipment market, this operation provides an attractive business opportunity.
Warnex provides no assurance that the initiation of a process to explore strategic alternatives will result in a transaction. No decision has been made to enter into any transaction at this time. The Company does not currently intend to disclose developments with respect to the exploration of strategic alternatives unless and until its Board of Directors has approved a specific transaction.
Warnex (www.warnex.ca) is a biotechnology company devoted to protecting public health by providing advanced diagnostic products and science-based services to the agri-food, pharmaceutical and healthcare sectors. Warnex’s DNA-based technology offers a versatile detection platform that produces accurate results rapidly, using Real-Time PCR technology combined with unique genetic markers and software. With a focus on pathogen detection in food, our development pipeline also includes applications in GMO testing and meat speciation, as well as in the detection of viruses, yeasts and moulds. Warnex’s analytical, bioanalytical, and medical laboratory service groups offer a variety of quality control services, method development and validation, contract R&D, bioavailability and bioequivalence studies for clinical trials, and medical laboratory testing. Warnex is a trademark of Warnex Inc., Laval, Quebec.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this news release are forward-looking and are subject to numerous risks and uncertainties, known and unknown. For information identifying known risks and uncertainties, relating to the early commercialization of Warnex products, intellectual property and licensing, R&D of new Warnex products, integration of acquisitions, manufacturing and laboratory facilities, suppliers, key employees, key customers and business partners, financial resources and credit risk, government regulations, foreign currency risk and volatility of share price, and other important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the heading Risks and Uncertainties in the Management’s Discussion and Analysis for the third quarter ended September 30, 2006, which can be found at www.sedar.com. Consequently, actual results may differ materially from the anticipated results expressed in these forward-looking statements.