Complete Genomics Announces Restructuring Plan and Review of Strategic Alternatives
Complete Genomics, Inc. (Nasdaq: GNOM), today announced that it is taking steps to reduce cash consumption and has engaged Jefferies & Company, Inc. to assist it in exploring strategic alternatives. The company also plans to focus on development of clinical applications for its whole human genome sequencing service, while continuing to provide high-quality genomes to research customers.
"Leading hospitals, health care systems and physicians are beginning to adopt whole human genome sequencing for clinical applications," said Dr. Clifford Reid, Complete's Chairman, President, and CEO. "Our industry-leading accuracy should position us well to capture this emerging opportunity."
Complete will maintain its current monthly capacity of approximately 1,000 genomes at 40x coverage or 500 genomes at 80x coverage. The company expects to delay capacity expansion beyond those numbers until demand for clinical-grade genomes supports expansion. The delay in expanding capacity is resulting in deferred capital expenditures and job cuts, primarily in field and factory headcount. Approximately 55 employee positions in Mountain View, California, and other U.S. locations will be eliminated.
This employee reduction is expected to be substantially completed during the current quarter ending June 30, 2012. Restructuring and related costs incurred with this plan are estimated at $1.5 million, most of which will be cash expenditures. These costs are comprised of one-time termination benefits for employees whose positions are being eliminated and should be recorded this quarter.
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