Escalon, Up 48.3% Since Our Buy Signal
14 Days Ago, Plans to Offer Stock for Drew Scientific Group
04/09/2004
Yesterday Escalon Medical Corp. announced their intention
to acquire Drew Scientific Corp. We recently recommended buying
Escalon Medical Corp. stock in our Short-Term
Portfolio. In the 14 trading days since our buy signal
for the company, the stock has shot up 48.3%. An excerpt from
the company's news release concerning the proposed acquisition
follows.
WAYNE, Pa., April 8 /PRNewswire-FirstCall/
-- Escalon Medical Corp. (Nasdaq: ESMC - News) today announced
that Escalon intends to make an exchange offer for the shares
of Drew Scientific Group PLC (London: DRW), a diagnostics
company that specializes in analytical systems for laboratory
testing worldwide. Escalon intends to offer 0.0048 shares
of Escalon common stock in exchange for each ordinary share
of Drew Scientific that is validly tendered. The exchange
offer values each Drew Scientific share at 0.06 pounds sterling
(approximately $0.11) based on the closing price of $23.25
per share of Escalon common stock on April 7, 2004. If all
of the outstanding shares of Drew Scientific are exchanged,
Escalon would issue approximately 284,869 shares of Escalon
common stock in the exchange offer.
"Our recent private equity financing has provided us
with the flexibility to invest in a broader range of expansion
opportunities," commented Richard J. DePiano, Chairman
and Chief Executive Officer. "The acquisition would provide
Drew Scientific with needed working capital and provide Escalon
with another vehicle for growth. Drew Scientific would operate
as a separate division of Escalon."
The offer is subject to customary conditions,
including due diligence and government approvals, including
any approvals required under the British City Code on Takeovers
and Mergers.
Founded in 1987, Escalon develops, markets
and distributes ophthalmic diagnostic, surgical and pharmaceutical
products as well as vascular access devices. Escalon seeks
to further diversify its product line to achieve critical
mass in sales and take better advantage of Escalon's distribution
capabilities through internal product development, acquisitions
or strategic partnerships. Escalon has headquarters in Wayne,
Pennsylvania and manufacturing operations in Long Island,
New York and New Berlin, Wisconsin.
This announcement does not constitute an
offer or invitation to purchase any securities. The formal
offer document containing the full terms and conditions of
the exchange offer, together with a form of acceptance will
be distributed to the shareholders of Drew Scientific at a
later date.
SOURCE: Escalon Medical Corp. The full news
release can be found at http://www.escalonmed.com/.
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