LifeWave shares jump on joint venture talks

LifeWave will set up a venture with a US group to develop its wound treatment device.

LifeWave Hi-Tech Medical Devices Ltd. (TASE:LIFE) is negotiating with a US group to set up a joint venture for the development of its best sore treatment (BST) activities.

LifeWave hopes to sell 51% of the rights to its BST activities to the US group, while LifeWave will retain 49% in the joint venture. The US group will pay $48 million, with $38 million going to LifeWave itself, while the US buyer will also be committed to invest $10 million in financing the joint venture's activities.

LifeWave's shares have not had a single down day in 2009 so far. For the year to date, the company's shares have gained nearly 300%, and are up over 21% today.

LifeWave develops medical devices that use electrical stimulation to treat chronic wounds.

A condition for the deal going through is the receipt of an evaluation by a recognized international accounting firm that LifeWave's operation in the global sore treatment market is at least $140 million.

LifeWave's market cap has reached about NIS 76 million, compared with negative equity of NIS 4.3 million on its financial report, as of the end of last September. The company's accountants issued a going concern warning in LifeWave's statement for the third quarter of 2008 because they estimated that the company's money sources and cash flow may not be sufficient to pay the debts that are due.

This morning, turnover in LifeWave's share was 32.5 times higher than the average over the past three months. The share was up over 21% by the early afternoon.

Published by Globes [online], Israel business news - www.globes-online.com - on January 13, 2009

© Copyright of Globes Publisher Itonut (1983) Ltd. 2009

Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018