Saifun Semiconductor founder Dr. Boaz Eitan and his wife, Tally Eitan, have acquired electronic drug delivery systems maker Q-Core Ltd. from its receiver for NIS 5.6 million. They plan to inject an additional NIS 20 million into the company in order to keep it as a going concern and save the jobs of its 40 employees.
The Receiver General still has to approve the deal, but is expected to do so in a few days. Boaz Eitan declined to comment on the report.
This is apparently Eitan's first deal as a private investor. He currently serves as VP at Spansion Inc. (Nasdaq: SPSN), which acquired Saifun, which he founded and led. Tally Eitan is a founder and partner of the Eitan Mehulal Law Group
Q-Core has four product lines, all of which have US Food and Drug Administration (FDA) approval. They include an infusion pump, an enteral feeding pump, a veterinary infusion pump, and a range of accessories.
Q-Core went into receivership when its shareholder, Core Capital, which mainly comprised a group of private North American Jewish investors, unexpectedly fell into financial difficulties and stopping funding the company. The cut-off happened just when Q-Core was about to begin sales, having completed the development and certification stages of its products.
Q-Core has an immediate $900,000 order for its products and an orders backlog amounting to $12 million for the next two years, but lacked the cash to finance the production of the goods ordered. The orders are from the US, Europe, and Japan.
Q-Core was founded in 1996 at Incentive Technological Incubator, and raised $15 million to date from Core Capital. The company was unable to find new investors in the short time needed following the cut-off of funding from Core Capital, and went into receivership before its debts could accumulate. Q-Core has NIS 1.9 million in liabilities, mostly employee salaries, bank debts, which are guaranteed by the company's shareholders, and debts to the shareholders.
Eitan beat Ilex Medical Ltd. (TASE:ILX) and other bidders for Q-Core.
Published by Globes [online], Israel business news - www.globes-online.com - on February 2, 2009
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