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UNILAB PLANS DISPOSITION OF NON-CALIFORNIA OPERATIONS AND ACQUISITION OF EUROPEAN CLINICAL LABORATORY BUSINESS

 TARZANA, Calif., Jan. 19 /PRNewswire/ -- UNILAB Corporation (NASDAQ: ULAB) announced today that it has signed agreements with Corning Incorporated (NYSE: GLW) and with Unilabs Holdings S.A., the owner of 70 percent of Unilabs S.A., a Swiss clinical laboratory company, by which the company would retain its California clinical laboratory business, significantly reduce its debt, reduce its shares outstanding and acquire a substantial investment in a European clinical laboratory company.
 Completion of each of these transactions is subject to several conditions, including receipt of all required regulatory approvals; approval by a majority vote of Unilab stockholders, excluding the shares held by Corning and its affiliates and by certain other principal stockholders; and completion of the other transaction. The company intends to provide details of both transactions in a proxy statement to be mailed in first half of 1993.
 The company currently has approximately 45.5 million shares of common stock outstanding and approximately $90 million in debt. Following completion of these transactions, Unilab would have approximately 32 million shares of common stock outstanding (of which Corning would own approximately 10 percent) and approximately $20 million of debt.
 Andrew Baker, chairman and CEO of Unilab Corporation, said, "The completion of these transactions would bring three important benefits to the company. First and foremost, it would enable us to focus our domestic efforts on California, whose clinical lab market presents the most significant opportunities for growth. Second, it would improve our balance sheet by reducing our debt substantially and by decreasing the number of shares outstanding by roughly one-third. Finally, it would give us a major stake in the European clinical laboratory market, where we believe there are significant opportunities for independent clinical laboratories."
 Under the agreement with Corning, Unilab would engage in a transaction, following which:
 -- Corning would own 100 percent of Unilab's non-California operations comprising Unilab's facilities and operations in Denver, Dallas and Phoenix. These operations would be liable for $70 million of Unilab's approximately $90 million of current debt. Annual revenues from these operations are approximately $85 million.
 -- Unilab's other stockholders would own Unilab's California operations comprising Unilab's facilities and operations in Los Angeles, San Jose and Sacramento. These operations would be liable for approximately $20 million of Unilab's current debt. Annual revenues from these operations are approximately $130 million.
 -- The company would receive 100 percent of J.S. Pathology, Plc (JSP), the largest clinical laboratory company in the United Kingdom. JSP, currently owned by Corning, has annual revenues of approximately $20 million.
 -- Corning would own Unilab common and preferred stock totaling approximately 3.5 million shares, as well as warrants and options to purchase an additional 0.6 million shares of Unilab common stock.
 Under the terms of the agreement with Corning, if the average closing price of Unilab common stock during the ten trading days before closing exceeds $8.50 per share, Corning has the right to terminate the transaction. Similarly, if the closing price during that period is less than $4.50 per share, Unilab has the right to terminate the transaction. As noted above, termination of the Corning agreement by either party would result in termination of the agreement with Unilabs Holdings S.A. The closing price of Unilab as of yesterday (Jan. 18, 1993) as reported by NASDAQ was $6.375 per share.
 Under the second agreement, Unilab and Holdings (which is not currently related to Unilab) would jointly participate in a new European company in which Unilab would have a 40 percent equity interest and Holdings a 60 percent equity interest. Unilab would contribute 100 percent of JSP to the new European company and would pay and/or issue to Holdings $21 million in cash and/or newly issued Unilab common stock valued at the time of closing. (The amount of Unilab common stock to be contributed is subject to a 10 percent upward adjustment upon certain conditions.) Holdings would contribute 70 percent of Unilabs S.A., a Swiss clinical laboratory company, to the new European company. Unilabs S.A. had revenues for the fiscal year ended May 31, 1992 of approximately $45 million.
 Unilab Corporation currently supplies clinical laboratory testing services through its wholly owned subsidiary MetWest, Inc. in Sacramento, San Jose and Los Angeles, Calif.; Denver; Phoenix; and Dallas.
 -0- 1/19/93
 /NOTE TO EDITORS: Corning Incorporated today issued a separate related release. For more information contact: Kathryn C. Littleton of Corning, 607-974-8206/
 /CONTACT: Richard A. Michaelson of Unilab, 201-525-1000/
 (ULAB)


CO: Unilab Corporation; Corning Incorporated; Unilabs Holdings S.A. ST: California IN: HEA SU: TNM

SM-KW -- NY094 -- 6594 01/19/93 17:44 EST
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Publication:PR Newswire
Date:Jan 19, 1993
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