Virtek Vision acquires Engineering Services biotechnology business
ESI's biotechnology business includes several automation technologies, including fast and accurate DNA micro-arrayers. Launched in 1999, ESI's arrayer has sold over 40 units and the current sales backlog for this product, which Virtek will acquire with the purchase, is approximately $1.5 million.
Along with Virtek's ChipReader, ESI's arrayer is a key enabling technology in the field of genetic research. Demand for both products is being driven by the increasing use of DNA micro-arrays. DNA micro-arrays allow researchers to assess which genes are turned "on" or "off" in a cell or tissue and to evaluate the extent of a gene's presence under various conditions.
"Acquiring a high quality arrayer is a key part of Virtek's growth strategy in the biotech industry," said Jim Crocker, president and CEO of Virtek Vision International Inc. "The arrayer perfectly complements our ChipReader DNA reader and brings us closer to providing the complete solution that researchers need to acquire and evaluate important data from raw DNA."
In addition to the arrayer, ESI has also developed and is launching a colony picker, and is currently developing a new, small desktop arrayer and a colony arrayer. The colony picker visually searches for, recognizes, and removes yeast and bacteria colonies containing DNA. The colony arrayer places these colonies on micro-array substrates for analysis in instruments such as the ChipReader.
According to the terms of the acquisition, Virtek will pay $3 million in cash and $3 million in stock for the biotechnology business. In addition, Virtek will pay a royalty of 4% of sales for a period of five years, in consideration for non-competition agreements for this period.
ESI was founded by Andrew Goldenberg, the director of the Robotics and Automation Laboratory and Mechatronics Laboratory at the University of Toronto who is known for his work in the field of robotics. Goldenberg will become president of a newly formed development company, which will be a wholly owned subsidiary of Virtek. The role of this company will be to spearhead ongoing development and commercialization of robotic applications for the biotechnology business.
This acquisition was funded by the proceeds of a successful equity offering completed by Virtek in June 2000. This oversubscribed financing raised $20.125 million to fund research and development initiatives and acquisition activities as part of the company's growth strategy.
Virtek develops, manufactures, and markets precision laser technology systems. Their systems increase productivity and quality through a growing number of applications for industries such as biotechnology, aerospace, and prefabricated construction. Applications include high-speed inspection and DNA imaging. The company maintains offices in Waterloo, Boston, London, and Brussels.
For more information: Philip Nafekh, VP Finance & CFO, Virtek Vision International Inc., 785 Bridge St., Waterloo, ON, Canada N2V 2K1. Tel: 519-746-7190. Fax: 519-746-3383. Email: philip.nafekh@virtek.ca.
Edited by Laura DeFrancesco
Managing Editor, Bioresearch Online