Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : GSII - GENERAL SURGICAL INNOVATIONS, INC. -- Ignore unavailable to you. Want to Upgrade?

To: Epics who wrote (170)	2/10/1999 11:54:00 AM
From: Lighthouse	Read Replies (1) \| Respond to of 211

Would a buyout of GSI by GDT be likely? I do not think so at this time. GDT wants to be a cardio powerhouse. With some AAA and radiation stuff thrown in the mix. General surgery carries lower margins and GDT does not have a dominant position in the general surgery market. I imagine the Origin division of GDT, minus the AAA graft, has all ready been considered a potential divesture candidate. This view is shared by Cowen & Co. who wrote yesterday, "It is no secret that GDT has signaled a lack of commitment to the general surgical market. Sales for the biz apx. $65M . .. . . . Furthermore, we would not dismiss the possibility that GDT ends up selling the biz and focusing on core CRM and VI." GDT has probably moved its good reps in this business away from general surgery and into other areas. GDT now has a dilema: Pay potentialy a decent sum ($12.9 times 3 plus legal fees) to GSI and still have issues with market availability and patents or sell the divison to GSI or some other third party. Selling to another third party will leave GDT with the liability, so if they went this way I would expect GDT to try and settle for some figure above $12.9 Million. General surgey sale price would not be exceedingly high as the margins in the biz are o.k. , but not great and the likely buyers have a presence anyway. Perhaps GDT has reserved against this outcome all ready and it would be easy for them? Selling to GSI . . . . . interesting thought.