Integrated BioPharma, Inc., announced today the implementation of the Company's repositioning program to focus singularly on its historic expertise and success in the nutraceutical field. On August 18, 2008, the Company completed a sponsored spin-off of its subsidiary, iBioPharma, Inc., through a stock dividend of its shares of iBioPharma to the Company's stockholders and immediately thereafter effecting a $5.0 million placement of shares of iBioPharma. This will eliminate approximately $3.0 million in expenses that the Company would otherwise be required to account for and fund in each of the next few years and will allow iBioPharma to obtain capital directly from investors whose knowledge and return requirements are reconcilable with biotechnology investment.
In conjunction with the spin-off, all of the holders of the Company's $6.0 million of Series C Convertible Preferred Stock elected to convert their preferred shares into common stock of the Company, thereby eliminating approximately $1.0 million in annual preferred dividends and terminating the various preferences they held over the common stock. In addition, insiders of the Company exercised stock options previously granted to an extent that resulted in the contribution to the Company's capital and cash of $1.4 million.
The Company has engaged advisors to assist it in the sale or strategic partnering of its Pharmaceutical Segment in Colorado. Upon completion of this transaction, which cannot be assured, the Company expects to save approximately $2.0 million per annum that would otherwise be spent to support the growth and further development of the Pharmaceutical Segment.
"We are now free to focus our capital and management entirely on our core business -- nutraceuticals -- where we have positive experience and important distribution relationships," said E. Gerald Kay, Chairman and Chief Executive Officer of the Company. "We feel we are now in an excellent position to capitalize on our new product line that is currently being introduced in our distribution channels this month."
About Integrated BioPharma, Inc. (INBP)
Integrated BioPharma is a unique grouping of companies presently serving the varied needs of the health care industry. Through its core nutraceutical business, the Company creates, develops, manufactures and markets products worldwide. Through its subsidiary AgroLabs, Inc., INBP distributes and markets healthful nutritional products under the following brands: Naturally Aloe, Naturally Noni, Naturally Pomegranate, Naturally Thai Mangosteen and, most recently, Naturally Superberry Upgrade, among various other nutritional products. Additionally, through its subsidiary InB:Manhattan Drug Company, INBP manufactures vitamins and nutritional supplements for sale to distributors, multilevel marketers and specialized health-care providers. Its pharmaceutical business operates a cGMP facility for the production and sale of Paclitaxel and related drugs and provides technical services through its contract research organization. Further information is available at www.ibiopharma.com
Statements included in this release related to Integrated BioPharma, Inc. may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such Statements involve a number of risks and uncertainties such as competitive factors, technological development, market demand, and the company's ability to obtain new contracts and accurately estimate net revenues due to variability in size, scope and duration of projects, and internal issues in the sponsoring client. Further information on potential risk factors that could affect the company's financial results can be found in the company's reports filed with the Securities and Exchange Commission.