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Complete Genomics (GNOM) Mulling Strategic Alternatives, Including Possible Sale

 June 05, 2012 07:23 AM

(By Balachander) Complete Genomics Inc. (NASDAQ:GNOM) is looking at strategic alternatives, including a possible a sale or equity investment and the company announced a restructuring program that included jobs cuts.

The Mountain View, California-based developer of DNA sequencing platform for human genome sequencing said it intends to focus on clinical sequencing and the restructuring plan positions it to capture this emerging opportunity.

During the quarter ending June 30, roughly 55 jobs will be cut in Mountain View, California, and other U.S. locations due to a delay in expanding capacity, the company said. The company will maintain its current monthly capacity of about 1,000 genomes at 40x coverage or 500 genomes at 80x coverage and it expects delay capacity expansion beyond those numbers until demand for clinical-grade genomes supports expansion.

[Related -Illumina (ILMN) Says Court Agrees To Review Patent Decision]

For the first quarter ended March 31, the company posted a wider loss as revenue dropped and expenses increased. Its net loss widened to $20.2 million from $12.5 million, while revenue plunged 43 percent to $3.9 million.

As of March 31, 2012, the company's backlog was around 5,700 genomes, including about 1,000 genomes booked in the first quarter, representing an aggregate revenue potential of roughly $27 million.

The company has engaged Jefferies & Company Inc. to act as its financial advisor to assist in its review of strategic alternatives.

The stock, which has been trading in the 52-week range between $1.57 and $18.55, ended Monday's regular trading at $2.04.

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