Oxford Molecular Group Plc has conditional agreement to buy US bioinformatics software supplier Mountain View, California-based IntelliGenetics Inc for UKP5.2m. Under the deal, Oxford Molecular will pay Amoco Technology Co, the vendor of IntelliGenetics, $625,000 in cash, UKP850,000 in loan notes and 6.5m new ordinary shares, which will give Amoco a 15% holding in the enlarged company. The loan notes are convertible into ordinary shares at 100 pence a share at any time up to the third anniversary of completion; on full conversion, a further 1m ordinary shares will be allotted to Amoco raising its holding to 16.9%. Amoco has promised not to dispose of any of its shares until the end of April 1996. The Oxford-based drug design software company says IntelliGenetics’ DNA and protein sequence analysis software products will complement its existing products and the acquisition of a US company will give it greater credibility in the US market where it is not performing well. Making in-roads into the US was one of the key aims outlined by the company’s directors when it floated on the London stock exchange in March 1994, raising UKP9.3m. Oxford Molecular has posted a pre-tax loss for the six months to June 30 of UKP930,000 compared to a UKP490,000 loss in the same period last year. Loss per share was 3.5 pence compared with a loss of 4.4 pence in the same period last year. Oxford Molecular attributed the loss to significant investment in the development of the business. Given the size of the proposed acquisition, trading in Oxford Molecular’s shares has been suspended pending approval of the purchase by its shareholders, among them Oxford University. Despite the losses Oxford Molecular’s turnover has increased 85% to UKP1.09m from UKP590,000. The acquisition is part of Oxford Molecular’s goal to become the world’s best molecular design company and it has just appointed the Nobel prize winner Professor James Watson and Oxford University’s professor of clinical medicine Professor John Ball to its International Scientific Advisory Panel. IntelliGentics was formed in 1980 by four professors at Stanford University, California and became a wholly owned subsidiary of Amoco in 1990. It posted a $710,000 pre-tax loss on a turnover of $2.30m for the half year ending July 2, 1994. The full year pre-tax loss for the year ending December 31, 1993 was $2.66m on a turnover of $5.08m. The IntelliGenetics name is likely to stay as will the current 42 employees. Its software, which runs on Windows personal computers, Macintoshes and Sun Microsystems Inc systems, is aimed at to research establishments and government bodies, like the DNA Sequence Databank. On the other hand, Oxford Molecular products are targetted at commercial organisations like pharmaceutical and biotechnology companies. Its software runs on iAPX-86, Macs and Silicon Graphics Inc machines. Oxford Molecular’s finance director, Andrew Maunder, would be leaving in September and Diana Audley, the group financial controller has been appointed his designate.
