IRVINE, CA, March 3, 1997 — InVitro International (Nasdaq SmallCap Market Symbol “INVI”) today announced it has signed a letter of intent to merge with Shenyang International Inc. in a transaction where InVitro stockholders would retain 20% of the combined company’s common stock. The proposed transaction is subject, among other conditions, to additional due diligence investigations, approval by the board of directors for each of the parties, preparation and execution of a definitive merger agreement, filing and the effectiveness of a registration statement and proxy materials with the Securities and Exchange Commission, and approval by the majority vote of InVitro shareholders.
The Company currently anticipates the merger proposal will be presented to InVitro’s board for consideration before the end of March 1997.
Privately-held Shenyang International Inc. is a foreign holding company organized in the British Virgin Islands and owns 99% of ShenYang Holding Company (“SHC”). Organized in 1988 and based in the Liaoning Province of northeastern China, SHC operates four business divisions in mainland China with approximately 300 employees. SHC’s business operations include distribution of medical products, the manufacture and sale of computer systems, ownership and management of the Lan Hua Hotel in ShenYang city and development of international industrial trade. Among other products, SHC distributes medical scanning devices for General Electric and markets personal computer hardware and networking systems. SHC has operated profitably for the last five years, and its annual revenues have increased from $6.5 million in 1992 to more than $15 million currently.
InVitro International, organized in 1985, develops and markets proprietary in vitro assay systems to detect, predict and rank potential irritation and toxic levels of substances to humans and the environment and distributes child safety and identification products. Located in Irvine, California, the Company distributes its products throughout North America, Europe and the Pacific Rim. InVitro previously reported a net loss for the year ended September 30, 1996 of $1,899,000, or $.15 per share, on revenues of $1,063,000. Results for the most recent fiscal quarter ended December 31, 1996 were a net loss of $506,000, or $.04 per share, on $259,000 in net sales. At February 28, 1997, InVitro had 14,028,300 shares of common stock outstanding.
Assuming the proposed merger is successfully completed, InVitro has undertaken to reduce its existing business operations to eliminate negative cash flow and currently anticipates those operations will continue under the direction of InVitro’s management as a separate division or subsidiary of the combined enterprise.
The statements made in this press release contain certain forward looking statements within the meaning of section 27a of the Securities Act of 1933 and section 21E of the Securities Exchange Act of 1934 that involve a number of risks and uncertainties, including the risk that InVitro may be unable to complete the proposed transaction. Actual events or results may differ from InVitro’s expectations. In addition, investors should be apprised of risk factors discussed from time to time in the Company’s filings with the Securities and Exchange Commission, including without limitation information set forth in Exhibit 99.1 filed with the Company’s Annual Report on Form 10-KSB for the fiscal year ended September 30, 1996.