EXHIBIT 99
Company Contact:
Arthur A. Koch, Jr.
Chief Operating Officer
(302) 456-6789
http://www.sdix.com
Investor Relations Contact:
Lippert/Heilshorn Associates, Inc.
Lisa Lettieri, V.P.
(212) 838-3777
lisa@lhai.com
STRATEGIC DIAGNOSTICS INC. ANNOUNCES
ACQUISITION OF HTI BIO-PRODUCTS, INC.
HTI 1998 Sales of $5.7 million and Pre Tax Profits of $800,000
Provides Future Resources to Develop the Emerging Agricultural and
Water Quality Markets
Newark DE, March 1, 1999, Strategic Diagnostics Inc. (NASDAQ NM: SDIX) - today
announced it has completed the acquisition of HTI Bio-Products, Inc. a privately
held manufacturer of custom and proprietary antibody products and services
located near San Diego, CA (HTI). HTI had 1998 revenues of $5.7 million and pre
tax profits of $800,000. These results are preliminary and SDI expects to
complete an audit within the next 75 days. HTI, a primary manufacturer of
antibodies and biochemicals, was founded in 1990. HTI's products and services
include custom antibody production, bulk antibody and biochemical products. SDI
believes that these capabilities will afford it the ability to leverage its
manufacturing costs, particularly in its test-strip production for agricultural,
food and water quality product lines. These products utilize large quantities of
polyclonal antibodies that the Company has previously purchased from third
parties. SDI believes that HTI's product lines will also enhance SDI's existing
capabilities in antibody production by adding extensive polyclonal products and
services to the monoclonal products and services provided by its TSD BioServices
subsidiary (TSD). The customers of HTI are complementary to TSD's and share
common characteristics in that they are primarily pharmaceutical and
biotechnology companies developing important medical diagnostics as well as
leading medical research facilities. SDI believes that the combination and
integration of these customer relationships will allow both TSD and HTI to offer
their customers broader product offerings and will help establish these
companies as a single source for all of their customers' antibody and
biochemical requirements. Similarly, SDI believes the integration of these
operations will result in significant cost savings and be accretive to earnings.
Under the terms of the agreement, the Company paid approximately $8.1 million in
cash, issued 556,286 shares of Series B preferred stock and assumed
approximately $100,000 of long term debt. The preferred shares convert into
common shares on a 1-for-basis at $3.50 per share and carry a cumulative, annual
cash dividend of $0.175 per share and a liquidation preference. The Company is
also obligated to pay a percentage of net sales of certain products over the
next three years, not to exceed $3 million. Approximately $6 million of
acquisition financing has been provided by the Company's commercial bank.
[SDI LOGO] STRATEGIC DIAGNOSTICS INC. o 111 Pencader Drive o Newark, DE 19702 o
(302) 456-6789 o FAX (302) 456-6770
Commenting on the acquisition, Mr. Richard C. Birkmeyer, President and CEO of
SDI said, "We are delighted to be able to place the resources and capabilities
of our two companies together. HTI has clearly demonstrated itself to be a
growth business every year since its formation in 1990. We expect that the
synergies to be derived from the combination of customers will significantly
enhance our collective position in the marketplace. We will now be able to offer
our customers an extensive and comprehensive set of products that will place us
in a position to earn single source provider status with those customers who are
looking for greater ease in making the purchases of these products and services.
We expect to integrate these businesses throughout the balance of 1999 so that
we structure the combined business to fully benefit from the operating
efficiencies by the end of the year. HTI brings a well-developed infrastructure
that readily lends itself to support the additional volumes of current products
and services as well as future expension of additional offerings.
"Looking to the whole of SDI, we believe this acquisition will help us grow our
business to a greater critical mass and should provide significant future
resources that will be useful as we develop our agricultural and water quality
markets as they emerge. We invested heavily in these emerging markets,
particularly our agricultural and food testing business, during the second half
of 1998. We believe these investments will help us to develop larger market
opportunities and create, in the case of food testing, new markets for our
technology and products. We believe this acquisition complements those
investments in our markets and together it should enhance shareholder value for
1999 and beyond."
Michael Dale, President and CEO of HTI Bio-Products, Inc., commented, "We are
excited to be able to offer our customers the additional products and services
of TSD and SDI, and at the same time, the opportunity to offer our products and
services to their customers. It is clear to us that both sets of customers stand
to benefit from this combination of talent and resources. Looking at the
business case apart from the customer benefits, we believe the profitability of
the combined operation will be enhanced as we integrate operations. We have
already identified areas where we believe we will be able to reduce costs,
leverage the existing infrastructure and improve overall bottom line
performance."
Srategic Diagnostics is a leading provider of biotechnology-based diagnostic
tests for a broad range of commercial applications. Through its TSD BioServices
subsidiary, Strategic Diagnostics also provides antibody and immunoreagent
research and development services. Strategic Diagnostics' test kits are produced
in a variety of formats suitable for field and laboratory use, offering
advantages of accuracy, cost-effectiveness, portability, and rapid response.
This news release contains certain forward-looking statements reflecting SDI's
current expectations. When used in this press release, the words "anticipate,'
"enable," "believe," "expect", and similar expressions as they relate to SDI are
intended to identify said forward-looking statements. Investors are cautioned
that all forward-looking statements involve risks and uncertainties, which may
cause actual results to differ from those anticipated by SDI at this time. Such
risks and uncertainties, include, without limitation, SDI's ability to manage
growth, the integration of acquired systems, including those of HTI, unknown
Year 2000 issues arising from acquired systems, changes related to acquisitions
such as the amortization of significant goodwill and other intangible assets,
changes in demand for products, delays in product development, inability to
obtain required government approvals, modifications to development and sales
relationships, the ability to achieve anticipated growth, competition,
seasonality, and other factors more fully described in SDI's public filings with
the U.S. Securities and Exchange Commission.
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