Navamedic sells chitin operation - Focus on core strategy
Navamedic sells ChitiNor AS to Seagarden AS for NOK 2.3 million in shares. The decision is in line with the company's strategy to move from a glucosamine pure-play to a specialty pharma company with a broad product portfolio. While the sale reduces the group's long-term debt by NOK 2 million, it also reduces the overall cost level and frees up management capacity to focus on the company's core business.
ChitiNor contributed to the EBITDA of Navamedic with NOK -1.4 million in 2007 and with NOK -0.4 million in Q1 2008. In addition, the cost of owning and managing ChitiNor has been estimated to be around NOK 0.15 million per quarter. A NOK 1.65 million write down is made in Q1 to reflect the sales price of ChitiNor AS.
Navamedic retains the ownership of its proprietary glucosamine production method. Should it see it financially beneficial, Navamedic may utilize this technology to reduce raw material costs.
The former Chairman of the Board in Navamedic, Thorleif Thormodsen, is a minority share holder and a board member in Seagarden AS.
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