Ahh, our 'formerly' ratdog INVN has made the WSJ Heard (herd) On The Street column today....
Funny, isn't it, that no one talks about these things when they are in the best possible buy position, like $1.50-3.00
Anyway, the back-story>>
InVision Holder Sees Windfall
Luxembourg Lawyer
Gains as GE Buys
Baggage-Screening Firm
By KATHRYN KRANHOLD
Staff Reporter of THE WALL STREET JOURNAL
July 21, 2004; Page C4
In coming weeks, when General ElectricCo. closes on its acquisition of InVision Technologies Inc., maker of baggage-screening machines, a little-known Luxembourg lawyer named Arsene Kronshagen looks to be the biggest winner.
Mr. Kronshagen, who is InVision's majority shareholder as of April 1, 2004, stands to cash in his 1.4 million shares, or 8% stake, for $70 million, having paid a tiny fraction of that amount a few years ago.
In March, GE agreed to pay $50 for each of InVision's 17.5 million outstanding shares of common stock -- a 21% premium to InVison's share price on the Friday before the deal was announced the following Monday. InVision uses advanced X-ray technology called computed tomography, or CT scanning, to screen baggage for explosive devices at airports.
Last month, InVision's 244 shareholders approved the GE purchase. The deal was expected to close this week but it has been delayed partly because of pending approvals from federal regulators.
The road to riches for Mr. Kronshagen came about through a sweet deal in September 1998, when Eugenio Rendo, an Italian construction magnate who co-founded InVision, sold his majority stake of 2.4 million shares to Mr. Kronshagen for $5 million. The shares were held by Mr. Rendo's Luxembourg-based company, Harax Holdings SA, which was acquired by Mr. Kronshagen. At the time of the 1998 transaction, Mr. Rendo's shares were valued at more than $14 million based on InVision's stock price.
Mr. Rendo completed the sale shortly after entering a plea agreement in a case stemming from charges that he was involved with bribing state officials to obtain a contract to build a new railroad station in Milan, according to the Milan prosecutor's office and documents filed with the U.S. Securities and Exchange Commission.
Since 1998, Mr. Kronshagen has remained InVision's largest shareholder despite having sold off one million of those original 2.4 million shares over the past few years. Investment-management firms Neuberger Berman LLC and Wellington Management Co. LLP both own 6.8% of the shares, making them the second-largest shareholders as of April 1, 2004.
Reached at his office in Luxembourg, Mr. Kronshagen declined to comment about his InVision holdings. "We're a law office," said Mr. Kronshagen, whose clients have been reported to include Austrian gun maker Gaston Glock. He also sits on the board of the Pan-European Organization of Personal Injury Lawyers.
An InVision spokeswoman, Laura Graves, said the company doesn't know anything about its largest shareholder. She said he is a passive investor who didn't attend shareholders' meetings. GE declined to comment.
The nation's leading provider of security-scanning equipment to the country's airports, InVision was created in 1990 through a partnership between one of Mr. Rendo's companies, FI.M.A.I. Holding SA, and Imatron Inc., a company that developed electronic-beam technology scanners used by cardiologists and radiologists. GE bought Imatron in 2001.
FI.M.A.I. funded the majority of the new venture while Imatron provided the technology. Sergio Magistri, who became InVision's chief executive in 1992 and remains its top executive, also had a relationship with Mr. Rendo. From 1988 to 1991, Mr. Magistri, an electrical engineer with a doctorate in biomedical engineering, worked as a consultant to FI.M.A.I., helping to form the company, develop its business plan and its technology, according to SEC filings.
One former InVision employee recalled Mr. Magistri praising Mr. Rendo at a dinner in Washington for having the "foresight" to support the new technology being used in explosive-detection devices. Mr. Rendo told the group that he never thought the technology would make money but he felt it was important to pursue it, the employee recalled.
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