Aquasearch Inc., with its Chapter 11 reorganization plan freshly approved by U.S. Bankruptcy Court in Hawaii, celebrated its coming-out party today with a new name, new stock ticker symbol and new plans for the future. Aquasearch re-emerges
with new name and focusThe Big Island biotech company
had filed for Ch. 11 bankruptcyBy Dave Segal
dsegal@starbulletin.comThe Big Island producer of microalgae-grown nutritional supplements said yesterday it was changing its name to Mera Pharmaceuticals Inc. and would trade on the over-the-counter bulletin board under the ticker symbol MRPI. It previously traded under AQSE and then AQSEQ, when the Q was added to denote that the company was in bankruptcy.
The stock today soared 42.9 percent, or 4.5 cents, to 15 cents on volume of 157,000 shares that was nearly double its six-month average. The shares closed at their highest level since hitting 15.5 cents on Oct. 31, 2001.
Rich Propper, the chairman and acting chief executive officer, also said yesterday the incorporation of the company will be moved to business-friendly Delaware from Colorado. He said the new company has divided itself into two divisions, one for nutraceutical products and the other for pharmaceuticals, and said that the company is currently conducting a search for a permanent CEO. Harry Dougherty, the interim president of the company, will have his position restructured once the new CEO comes on board, Propper said.
"We wanted to create a new beginning for the company since nutraceuticals, as well as pharmaceuticals, are part of the business," Propper said. "A new name made sense at this time."
Mera Pharmaceuticals derives its name from the French word for sea, "mer."
Propper said all creditors' claims have been adjudicated and will be paid over the next month.
Under the reorganization plan, unsecured creditors will be paid 17.5 percent of their claims in cash for a total of about $700,000. The 14-year-old company has lost about $21.4 million through April 30, 2002, according to its latest filing with the Securities and Exchange Commission.
Aquasearch shareholders will get one share in the new company for each share they held in the old company.
Shareholders need not do anything because of the name change.
Propper said the new company is in good financial shape because of a $3.4 million infusion from Chinese investors. He said the company eventually will move most of its production to China. Propper said he hopes to begin construction of a facility in China "in the next month or so" and that it probably will be completed in 12 to 18 months.
Propper also said he intends to expand the Kona facility and in the next few days and will start advertising for eight to 10 people to increase the level of staffing there. Currently, he said, 16 or 17 of the company's 22 employees are based in Kona.
Together with other investors, Propper acquired a majority interest in Aquasearch by purchasing $3.9 million of the total $4.5 million in outstanding claims, has moved the company's corporate headquarters to Solana Beach, Calif., in north San Diego County.
The pharmaceutical division's research and development will be done in both San Diego and Kona while the nutraceutical research and development will be in Kona.
Propper, who regards Mera Pharmaceuticals as a multinational company, said he hopes the company can move up to the Nasdaq SmallCap Market or the American Stock Exchange by late this year or sometime next year. He said he expects the company to be profitable "next year sometime" and said that the company recently launched its main product, AstaFactor, at Longs Drug Stores throughout the western United States.
"We're going to enhance the marketing budget and more slowly expand across the country as production capacity becomes available so we don't outstrip our capacity," Propper said.
He added that Aquasearch's animal-feed product Aquaxan, which imparts a pinkish hue to farm-raised fish such as salmon, is not being pursued by the new company.
"Our Chinese partners may want the rights to the product," he said. "We would get a nice royalty on anything they manufacture themselves."