Analytik Jena sells stake in project business.

Jena, Germany 3/31/08 -- Analytik Jena AG has signed a contract to sell 51% of its project business, AJZ Engineering GmbH, to AJZ Engineering's management for 0.9 million [euro] ($1.2 million). In addition, the parties entered into a cooperation agreement under which Analytik Jena will secure credit for ongoing projects on a case-by-case basis. Over three to five years, these agreements will be reduced until AJZ is financially independent. Analytik Jena stated that the AJZ's unpredictable and volatile revenue made planning difficult and that the business's gross and earnings margins were low. "The decision is one in favor of growth, focus on the core business and a considerably higher level of transparency for the Analytik Jena business model," stated Klaus Berka, chairman of Analytik Jena's Executive Board.

AJZ Engineering offers technical planning, engineering and consulting services for laboratories, hospitals and universities, among other projects. Due to project delays, Analytik Jena's Project Solutions revenue fell 13.2% in fiscal 2007 to 26.1 million [euro] ($34.9 million) (see IBO 2/15/08) to 38% of company revenues. Project Solutions' operating margins fell from 15.5% to 12.6% and EBIT rose 6.3% to 336,000 [euro] ($448,000).