18 October 12 23:31–Is Given Imaging Ltd. (Nasdaq: GIVN; TASE: GIVN) coming to the end of the road as an independent company? From a notification released by the company yesterday after the close on Wall Street it emerges that it is examining “strategic options” for enhancing shareholder value. Given Imaging states that it has received “non-binding indications of interest…from a number of parties relating to a possible merger or sale of the company.” Following this announcement, the company’s share price shot up 14% at today’s opening in New York, and it rose in Tel Aviv today too.

Given Imaging has developed a camera in a pill for examining the digestive system. It has a market cap of $472 million. The largest shareholder is Discount Investment Corporation(TASE: DISI) of the IDB Holding Corp. Ltd. (TASE:IDBH) group controlled by Nochi Dankner, which holds 15% of the company directly and another 22% via Elron Electronic Industries Ltd. (TASE: ELRN). In the past it was said that Dankner saw Given Imaging as a company that could reach annual sales of $1 billion, compared with $185-190 million projected for this year, and a target of $450 million in 2016.

However, in the light of the IDB group’s liquidity needs, it would seem that Given Imaging too has been put up for sale. At its peak, in 2004, it had a market cap of $1.2 billion. A sale now, if it happens, will not bring anything like that amount, but there will be a premium over the current market cap.

Given Imaging’s PillCam SB for examining the small bowel sells well, but the company’s growth potential in this market is not large. The big potential lies in the PillCam Colon for examining the large intestine. The company is currently making initial progress with this device. It is close to approval in Japan, and in the US, the company is due to start discussion on approval with the Food and Drug Administration (FDA), although only as a secondary examination tool…Read More>>

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