Lifecore Biomedical to be acquired by PE firm, reports Q2 results below the Street

Shares of Lifecore Biomedical, Inc. (Nasdaq: LCBM) are rocketing in pre-market trading after the manufacturer of biomaterials and medical devices said today that affiliates of global private equity firm, Warburg Pincus, will acquire the small cap for $239 million, or $17 per share in cash.

The $17 per share price represents a premium of approximately 30% over the volume weighted average price of Lifecore Biomedical’s shares for the last 30 trading days. The transaction is expected to close by the end of the first quarter of 2008.

The acquisition news overshadowed the company’s fiscal second-quarter results that fell short of analysts’ estimates on Wall Street. For the three months ended Dec. 31, 2007, Lifecore reported net sales of $17.3 million, below the consensus of five analysts polled by Thomson Financial of $18.27 million. The current quarter’s sales represented an increase of 4% over net sales of $16.6 million in the second quarter of 2007.

Net income was $1.24 million, or $0.09 per share, compared with net income of $1.37 million, or $0.10 per share, in same quarter of 2007. Three analysts polled by Thomson Financial were on average forecasting earnings of $0.11 per share.

Shares of Lifecore Biomedical (LCBM) surged 30.84%, or $3.96, to $16.80 in pre-market. Shares of Lifecore Biomedical have been trading in the range of $10.32 to $20.14 for the past 52 weeks.

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