Degussa attains sole ownership of start-up Proligo LLC and invests additional $ 18 million to support future growth
28-Aug-2001
Degussa AG, Dusseldorf, announced today that its subsidiary Degussa Corp, NJ, will acquire the outstanding
49 percent interest in Proligo LLC from GILEAD Sciences, Inc. (Nasdaq: GILD) to gain 100 percent ownership of Proligo. At the same time Degussa announced that it has provided $ 18 million to Proligo to fund the strategic expansion of Proligo’s nucleic acid supply capacity to the Genomics and Genetic Medicines market place.
Degussa will pay Gilead Sciences $ 14.3 million for the purchase of its
49 percent ownership interest under a call option negotiated at the Formation of Proligo between NeXstar Pharmaceuticals and SKW Trostberg AG in 1998, and carried forward to Gilead Sciences through its acquisition of NeXstar Pharmaceuticals in 1999. SKW Trostberg AG was merged into Degussa AG in February 2001. The deal is expected to close on August 31, 2001.
Proligo is a leading supplier of value added Nucleic acids to the Genomics and Genetic Medicines industry. Proligo successfully transforms innovative intellectual property to high quality products that fuel the Genomic Revolution. With manufacturing facilities in both North America and Europe Proligo is ideally positioned to supply the global nucleic acids market. The funding is ear-marked to increase the production capacity for monomers for DNA synthesis at Proligo’s Hamburg/Germany plant, as well as to increase the capacity for Locked Nucleic Acid (LNA) oligonucleotide probe manufacture and to build capacity for fully validated active pharmaceutical ingredient manufacture for Genetic Medicines at its Boulder, Colorado plant.
Proligo is part of Degussa’s Creavis unit, which nurtures new businesses in existing and future markets not currently covered by Degussa’s business units. "With Proligo, we have gained an excellent foothold in the rapidly growing biotechnology supply market. The future expansion of Proligo fits extremely well to our strategy of establishing ourselves in innovative new markets for specialty chemicals”, said Utz-Hellmuth Felcht, Management Board Chairman of Degussa AG. As a fully-owned company within the Degussa Group, Proligo will be in a position to particularly profit from Degussa's experience in the area of process technology and in the production of fine chemicals.
As a member of the Degussa Group, Proligo not only gains access to capital to fund its growth but also benefits from Degussa’s experience in engineering and chemical manufacture. “We are excited by the potential to fully utilize the experience of the Degussa Group. This will also enable us to rapidly build new capacity and service the growing demand for our products in the Genomics market”, said Wolfgang Pieken, President and CEO of Proligo LLC.
Proligo is a dedicated specialist in professional and progressive nucleic acid products. Nucleic acids are essential components of the genetic material of all organisms and are proving increasingly important in opening up new dimensions in diagnostic and therapeutic applications. Using new active agents based on synthetic nucleic acids, serious and life-threatening illnesses, such as viral infections or tumors, will in future be able to be detected early and treated effectively. With a workforce of some 120 employees, Proligo generated sales of around $ 15 million in fiscal 2000.
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