3DSP Teams With Testing Firm; Microsemi Making Biomed Chip
They may not be selling the farm, but they’ve leveraged it to the hilt.
Cash-strapped Odetics Inc., which had been rumored to be looking for a buyer for its Anaheim headquarters near Disneyland, has raised $16 million through a promissory note secured by the property.
The financing comes after Odetics Chief Executive Joel Slutzky told analysts and investors at a conference a few months back that the company planned a “liquidity event” that could include the sale of the 13.6-acre plot.
Given the property’s proximity to the Disneyland Resort, real estate brokers estimate that the Walt Disney Co. might pay a pretty penny for the land for a parking lot or other use.
In fact, Odetics’ land could fetch upward of $24 million if it were sold at the area’s prevailing market price, according to one broker familiar with Anaheim.
Besides Disney, others,from hotel operators to retail developers,also could be interested in the site.
The financing deal underscores a hard fact facing Odetics: its business of forming and spinning off companies hasn’t been all that fruitful lately. The last company Odetics spun off,and granted, it was a blockbuster,was ATL Products Inc. in 1997. ATL subsequently was bought by Milpitas-based Quantum Corp.
Since then, Odetics has been working with internal companies. Last year it planned an initial public offering for Iteris,a unit that makes products for automobile computers,for spring. But the market soured and Odetics shelved its plans.
“Because our strategy calls for us to go to the capital markets, we have found it difficult to purse some of our operations,” Slutzky said in February.
Odetics’ hope: the market for new stock issues will snap back sometime this year.
The promissory note, due in a year at a 10% annual interest rate, includes warrants to buy 426,667 shares of Odetics common stock at $4 apiece, issued to the private investor who anted up the $16 million. The investor could receive warrants to purchase another 426,667 shares of Odetics common stock at an exercise price equal to 110% of the common stock price if Odetics slips on its payments.
If Odetics prepays money before the first six-month period, up to $1.6 million of the principal amount is convertible, at the investor’s option, to Odetics common stock at $4 a share.
Odetics plans to use the $16 million to retire the pre-existing first trust deed on the company’s property, to pay down other debt and for operating expenses.
3DSP, Aptix Testing
Wireless chip designer 3DSP Corp. said it plans to develop testing technology with San Jose-based Aptix Corp. Irvine-based 3DSP, which recently closed on $12.5 million in funding, develops digital signal processors that power wireless devices.
Both companies plan to develop a testing system that 3DSP customers can use to test the chips it buys,a process that would take longer and be much more costly without such a system.
“Aptix rapid prototyping capabilities will be a key ingredient in our future success, enabling our customers to get to market faster,” said 3DSP Chief Executive Tom Beaver. “Aptix’s System Explorer will allow our customers to completely test the hardware and software components.”
Microsemi Inside
Microsemi Corp. recently signed a long-term pact with Houston-based Cyberonics Inc. to design and make a chip to be implanted into epileptic patients.
The Irvine company’s chip helps treat debilitating disorders using nerve stimulation by acting as a small generator. The Microsemi chip is set to be used in clinical trials researching the treatment of depression, anxiety, Alzheimer’s, obesity, irregular heartbeat and pain.
“Cyberonics’ selection of Microsemi for this implantable (chip) represents a significant milestone that highlights both our focus and commitment to the medical market,” said Microsemi Chief Executive Jim Peterson. “We have increased R & D; significantly in support of application specific standard products that regulate light, sound and power. In this case, we have been able to turn Microsemi’s expertise toward a product that can really improve the quality of people’s lives.”
Avrio Buys FocusCORE
Irvine-based FocusCORE Inc. accepted a buyout offer by Newport Beach investment firm Avrio Group LLC. FocusCORE, a maker of subscription-based software, expects the deal to close this week. Terms of the deal were not disclosed, but focusCORE executives said the company plans to continue making software.
