Jul 16 2009
Arrowhead Research Corporation (NASDAQ: ARWR) ("the Company") today announced that it has completed the first phase of a plan to increase its ownership in electronics films subsidiary, Unidym Inc., a strategy that was initially announced at its annual shareholder meeting on March 26, 2009. On July 15, 2009, Arrowhead agreed to a stock swap transaction with existing Unidym shareholders, the most recent in a series of transactions that increased Arrowhead's ownership of Unidym to 70%. This follows recent milestones achieved by Unidym, including progress toward commercialization in target displays markets, expanding its partnership model and aggressively reducing cash burn.
The transactions consist of:
The agreement on July 15, 2009 to exchange approximately 750,000 shares of newly issued Arrowhead common stock in exchange for an equal number of Unidym Series C preferred stock with Unidym stockholders;
The issuance and exchange of approximately 1.9 million shares of Arrowhead common stock for approximately 1.1 million shares of Unidym Series C Preferred Stock and 833,333 shares of Unidym Series C-1 Preferred Stock effective June 25, 2009;
The investment by Arrowhead of approximately $875,000 of cash and the conversion of $950,000 of intercompany loans into Unidym Series C-1 Preferred Stock on May 12, 2009 and June 25, 2009; and
The issuance and exchange of approximately 1.3 million shares of Arrowhead common stock to several Unidym stockholders for an equal number of Unidym Series A Preferred Stock completed June 11, 2009.
Pursuant to the agreements, the Arrowhead stock issued in the exchanges may not be sold for one year from the date of each agreement.
"Our ownership increase in Unidym is a key component of our 2009 strategic plan to capture value generated from Unidym's penetration of high-growth touch-screen and LCD markets," stated Dr. Christopher Anzalone, President and Chief Executive Officer of Arrowhead. "We are pleased with Unidym's success in forming and maintaining high quality partnerships and in continuing its penetration of the touch-screen and LCD markets despite challenging economic conditions. Our ownership increase in Unidym also reflects our confidence in Unidym's ongoing ability to pursue near-term commercialization opportunities in these markets."