Warnex to sell analytical services business
News of the sale – which values the analytics business at $C$1.1m ($1.07m) – follows weeks after Warnex divested its medical labs arm.
It also means that Warnex' bioanalytical division, which provides bioequivalence and bioavailability services for clinical trials, will be its only remaining unit in 2012.
Warnex will retain a 15 per cent equity interest in the analytical division, which provides product and facility quality control services for pharma and biotech companies.
The analytical services unit generated C$10.5m, or 47 per cent, of Warnex' total revenue in 2010 but has struggled more recently as a result of declining industry demand.
Strategic review
In response Warnex launched a strategic review of its operations in November shortly before the departure of long-serving CEO Mark Busgang.
The decision to focus on bioanalytical services looks like a sensible one given that – in contrast with the divested analytical and medical laboratories units – the division has seen revenue and net earnings grow in recent quarters.
Warnex said that - after the sale is completed in January - the divested unit’s operations will be based at a facility in Blainville, Canada.
Michael Singer, chair of Warnex’ executive review committee, said in a press statement that the deal "allows us to retain substantial upside in the analytical services business that we pioneered.
"The sale of our analytical services division serves as another important step in the process of improving our balance sheet and positioning the company and its stakeholders for future success" he added.
