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ChromaDex Corporation Message Board

  • investora2z investora2z Feb 25, 2013 9:40 AM Flag

    $6 million-Chromadex sells BluScience

    Chromadex has announced that it has entered into a letter of intent to sell its highly successful BluScience consumer product line to NeutriSci International. The CEO stated that while the launch of the product helped enhance the awareness about pTeroPure, selling the product to NeutriSci would help better consumer product marketing to further increase the popularity of the BluScience. NeutriSci plans to sell the product in the Southeast Asia Market in addition to the North American market. The company has a very good network in SE Asia. The total transaction is valued at approximately $6.0 million and will consist of a combination of cash, senior secured debt and an ownership interest in NeutriSci. ChromaDex will continue to get royalty on future net sales of BluScience products and also there is a supply agreement with NeutriSci for the patented pTeroPure pterostilbene. The rights of this patented product will remain with ChromaDex. At the signing of the LOI, CDXC received a $250K deposit as earnest money. The closing of the deal is expected to occur before March 31, 2013 subject to usual conditions. As per the CEO Jaksch, the sale will allow CDXC to focus on selling and marketing pTeroPure ingredient and increase focus on developing and commercializing new ingredients. This deal will obviously improve the cash flow of the company as the $6M payment will be a substantial boost to the balance sheet. Remember, sales (TTM) in 2012 were $9.9M. Further, the sales royalty will become a continuous source of revenue without any significant expense. Further, sale of the ingredient to NutriScience for manufacturing of the product will also add to the cash inflow. So the effort put in building the BluScience brand has paid off and this can be a game changer. Chromadex is trading above both its 50DMA & 200DMA. Recent uptrend is now easy to explain. Today's movement will be interesting.

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