Compugen Ltd. (Nasdaq: CGEN; TASE: CGEN) yesterday announced that "it has no intention of issuing equity at the company’s current market value." The statement was made in response to the plunge in the share price of in the past few days, for no apparent reason, which ignited rumors about the company's financial standing.
Compugen chairman Martin Gerstel said, "We have made no announcements that would account for the substantial decline in the price of our shares during the past few days. However, in discussions with shareholders and others, a great deal of concern has been raised that the company’s financial situation would require it to seek additional capital during the next few months regardless of market conditions or the price of its shares. This is not correct. The company has cash on hand and marketable securities, including the Evogene Ltd. (TASE:EVGN) shares owned by Compugen, that we estimate would be sufficient to fund the company’s currently planned operations well into 2010.”
Gerstel added , “Compugen’s planned operations for 2009, which include certain changes due to the current situation, will be outlined by me in a presentation next Wednesday, November 12th at the Rodman and Renshaw Healthcare Conference. Also, in order to avoid any misunderstanding with respect to the 2,150,000 Evogene shares held by the company, we view these shares as an excellent long term investment and have no interest or plans to sell them. However, they do represent a potential source of cash should that become necessary."
Compugen has cooperation agreements with several leading drug companies, including Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA), Roche Holding AG (SWX: RO),, and Merck & Co. Inc. (NYSE: MRK).
Compugen's share closed at $0.61 on Nasdaq yesterday, giving a market cap of $17 million. The share was traded at $2.03 at the beginning of September.
Published by Globes [online], Israel business news - www.globes-online.com - on November 6, 2008
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