Tag - Tmo

(Nasdaq:LLACU)
Scheduled for the week of May 19
$350 million estimated proceeds
$378.4 million estimated post-money valuation

If buying stock at an initial public offering is an act of faith, investing in special-purpose acquisition companies (SPACs) — startups with no operating assets (and no guarantee they will find any) — is an act of blind faith.

A SPAC is created with the sole purpose of acquiring an operating business with shareholders' money. Despite the fact that few SPACs have found anything to buy, new ones keep cropping up. Liberty Lane’s big selling point seems to be that it’s the first one that mighty Goldman Sachs is bringing to market, which may make it seem more legitimate in a sector once dominated by squirrelly shell companies traded in Vancouver.

Its founding officers, Paul Montrone and Paul Meister, had long tenures with Fisher Scientific, a manufacturer of scientific and industrial instruments now known as Thermo Fisher (NYSE:TMO). Montrone served as CEO from 1991 to 2006, and Meister was the company’s CFO from 1991 until 2001, when he was named vice-chairman of the board.

Fisher Scientific grew in part through 60 acquisitions, so the draw is that Montrone and Meister know to find acquisition candidates and structure good deals. Liberty Lane isn’t the only SPAC with experienced dealmakers at the helm, but not all have that distinction; several SPACs have executives who are more figureheads than deal-makers (Heckmann Corporation (NYSE:HEK) has on its board former Notre Dame football coach Lou Holtz and former U.S. Vice President Dan Quayle).

But no matter how good a track record Montrone and Meister have, they still have to find a good business to buy in the next two years, and that’s tough to . . .

Investors who want a stake in health care are well advised to consider the world of diagnostic medical devices. Dominated by global multibillion-dollar outfits like Medtronic, Inc. (NYSE: MDT), Stryker Corporation (NYSE: SYK) and Thermo Fisher Scientific, Inc. (NYSE: TMO) and Japan's Sysmex Corp. who pour hundreds of millions into research and development and have a strong hold on distribution channels, the category is a formidable challenge to even the most experienced players.

Chatsworth, Calif.-based IRIS International Inc. (Nasdaq: IRIS), a small, scrappy manufacturer of high-tech in-vitro diagnostic (IVD) imaging systems—blood analysis, urinalysis, oncology and infectious disease diagnostic devices—for major medical institutions, is boosting market share, thanks in part to an aggressive sales push and a pipeline of products with great promise. In the dog-eat-dog health-care sector, where high-profile pharmaceutical and biotech stocks reign supreme, IRIS hasn't gotten much notice, at least not yet.

But the little medical device maker is on the move. IRIS staged an impressive performance in the second quarter ended June 30. Net income rose to $1.8 million, or $0.10 per share, from a net loss of $4.5 million, or $0.25 per share, a year earlier (despite a charge of $5.2 million from the 2006 acquisition of Leucadia Technologies Inc., as well as a $500,000 charge related to the hiring of a new chief financial officer in May). Revenues rose 26% to a record $21 million, from $16.6 million.

The future looks bright, too. IRIS still has three years left in a five-year deal to supply the U.S. Department of Veterans Affairs with urine analyzers for the agency's medical centers and outpatient clinics in several states. IRIS plans to introduce three new products by the end of the year: iChem VELOCITY, a fully automated urine chemistry system to be launched in Europe; the NADIA PSA, a tool for the early detection of prostate cancer, which is expected to receive a Food & Drug Administration go-ahead; and a high-performance centrifuge (for blood/plasma separation), which will target an entirely new market. In addition, IRIS has plans to break into the molecular market with HIV and cancer detection technology, which could be rolled out in 2008.