Landec Corporation (Nasdaq: LNDC) is a materials science company that develops and markets patented polymer products for food, agriculture, personal care and drug delivery applications. Grace Matthews has a strong, long-standing relationship with Landec, having completed numerous transactions on Landec's behalf, including its sale of Dock Resins to Lubrizol and a joint venture in personal care polymers with Air Products and Chemicals.
In 2009, Landec engaged Grace Matthews to assist with an acquisition search that would expand Landec's capabilities in areas synergistic to the company's advanced polymers business. Grace Matthews search yielded several promising acquisition candidates, including Lifecore Biomedical, a developer and manufacturer of technically advanced biomaterials used in a wide and growing range of therapeutic treatments in the ophthalmic, orthopedic and veterinary markets.
Grace Matthews coordinated negotiations between Landec and the private equity owner of Lifecore, Warburg Pincus Private Equity, and assisted in due diligence activities. The purchase price for the Lifecore was $44.0 million, including $40.0 million in cash and $4.0 million in assumed debt. The Lifecore shareholders could receive additional payments up to $10.0 million, provided Lifecore achieves certain financial objectives in 2011 and 2012. The earn-out mechanism and structure was also negotiated by Grace Matthews.
The acquisition of Lifecore significantly advances Landec's commitment to advanced materials and achieves three stated objectives of Landec's acquisition strategy: to expand into growth areas beyond the company's core food technology, to invest in biomaterials that have synergies with the company's Intelimer polymers, and to make acquisitions that are immediately accretive to Landec's profitability.