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Biotech / Medical : New Brunswick Scientific Co., Inc. (NBSC) -- Ignore unavailable to you. Want to Upgrade?

To: Larry Liebman who wrote (46)	6/22/2000 10:29:00 AM
From: scaram(o)uche	Read Replies (1) \| Respond to of 724

Larry: CYTO.... haven't looked in ages. I presume that the plan is to spin out AxCell and thus recover an entity with leverage? Don't know..... depends..... I underestimated the power of the genomics frenzy, and the proteomics scramble could also get out of hand? That is, I haven't a clue. AXPH.... what is Walker's business plan this week? They've always had some seriously good science, and I expect it to play out some day. NBSC..... Roach Motel. Two companies.... the equipment business and DGI. Appears, to me, that the valuation of DGI is about minus $60 million. Nice claim language that Novo has paid attention to, so I'll say that it should be positive $30 million, and I'll thus say that $20/share is about right. That's why I said that "I must be missing something". How did I arrive at minus sixty? The current capitalization is $35M. This is significantly less than annualized sales, projecting last quarter's backorder-restricted results forward. Margins are better than 40%. That means that an efficient suitor could add about $10M to the bottom line, first year. I believe that certain property is carried on the books at cost. The huge increase in liquidity of the genomics subsector is going to trickle down, in part, to the sort of equipment that NBSC sells. Demand for shakers, ultralow freezers, etc., is going to go off scale. I do not believe that all purchases will be determined by snobs who turn up their nose at the New Brunswick reputation. Further, the reputation in shakers is excellent (note..... this is a 15 year old perspective!!). The new operations guy (President, Health Technology or something like that) looks like he has a decent background. He certainly inherits a situation where there's little downside.... how much worse can it get? Results have been negatively impacted by severance expenses. Results have been negatively impacted by backorders. Recent expansion in Europe expected to have an ongoing positive impact on margins. So..... I'll say that an insightful and efficient suitor could make it work for them at $95M. DGI..... patent issued, nice priority date. In-house targets have now been clearly described, as has been progress to date. Progress is said to include a "di-somer". Expanded Novo agreement. I'll therefore assign $30M for the 80% that NBSC holds. 35 plus 60 plus 30 equals 125, with 6 outstanding. But it can't be that easy, so "I must be missing something". Rick