SMMX completes its transformation:
Symyx Technologies Transitions to Pure-Play Scientific Software Company; Completes High Productivity Research Divestiture
Press Release Source: Symyx Technologies, Inc. On Tuesday March 2, 2010, 8:00 am EST
SUNNYVALE, Calif., March 2, 2010 (GLOBE NEWSWIRE) -- Symyx Technologies, Inc. (Nasdaq:SMMX - News) today announced its successful transition to a pure-play scientific software company with the completion of the planned divestiture of its High Productivity Research (HPR) business unit assets, previously announced on February 11, 2010. The divested assets will be owned and operated by FreeSlate, Inc. (formerly HPR Global, Inc.) in HPR's current location in Sunnyvale, California.
"This divestiture allows Symyx to operate as a focused, positive cash-flow software business, and to capitalize on its growth opportunities," said Isy Goldwasser, Symyx's chief executive officer. "As a pure-play scientific software company, we can better drive towards our core goals for 2010 of achieving the clear #1 position in the fast-growing electronic lab notebook market, of scaling our business and core franchises, and delivering consistent improvement in profitability, helping us track to our 20% adjusted EBITDA target for 2011."
"FreeSlate builds upon a tradition of enabling scientific R&D organizations to accelerate the pace of discovery while reducing costly, complex procedures that hinder efficiency," said John Senaldi, FreeSlate's chief executive officer. "As an independent, private company, we are excited to focus all our talent and energy on a singular purpose: enabling our broad, global customer base to achieve step-change gains in productivity and innovation. We are fortunate to have a committed, talented team with a track record of success and expertise in high-throughput experimentation."
The divestiture follows an extensive strategic evaluation and sales process in consultation with Symyx's financial advisors and consists of HPR's tools business assets and certain assets of Symyx's recently restructured contract research services operations. Under the divestiture agreement, Symyx transferred to FreeSlate, Inc., a newly formed company led by Mr. Senaldi, HPR's former president, substantially all existing HPR physical assets and certain intellectual property assets, including a portion of Symyx's patent portfolio and certain components of Symyx's Lab Execution and Analysis software suite. Mr. Senaldi resigned from Symyx prior to the signing of the divestiture agreement to lead the acquisition of HPR assets as founder and chief executive officer of FreeSlate.
As part of the divestiture, Symyx also provided approximately $8.6 million of positive net working capital (mostly in cash) at closing, receiving in return a $10.0 million note and common stock representing an approximately 19.5% equity interest in FreeSlate. Symyx retained all existing rights to royalties and licensing fees previously included in HPR, as well as relevant patents underlying these entitlements. Following the closing, FreeSlate hired substantially all Symyx employees previously in HPR. Symyx expects to conclude certain remaining legacy chemical research services contracts by the end of the second quarter of 2010. As a result of the divestiture and these actions, Symyx is concluding all of its HPR activities other than its ongoing license and royalty entitlements.
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