LARGO, Fla., Oct. 17 GeoPharma, Inc.(Nasdaq: GORX) - In a major step forward in GeoPharma's business model, thecompany announced today that it has finalized the acquisition of DynamicHealth Products, Inc. (OTC Bulletin Board: DYHP.OB) with all merger conditionssatisfied.
Dynamic, a leading distributor in the sports nutrition product andperformance drink industries, is a U.S. based cash-flow positive company withcomparable gross margins presenting an attractive opportunity for widening thebreadth of the overall Company and its existing distribution platform.GeoPharma has the ability to manufacture the majority of the products thatDynamic distributes. The combination of GeoPharma and Dynamic will bringeconomies of scale as gained from further vertical integration andimprovements surrounding the expanded distribution points across the U.S. thusmaking this a well-diversified company. GeoPharma expects increased revenues,operating profits, productivity, cost savings on multiple levels, and anenhanced distribution platform supported by a highly experienced managementteam from both the companies having extensive industry knowledge in marketing,developing, manufacturing and distributing.
In explaining the significance of the Dynamic transaction to the Company,Mihir Taneja, CEO of GeoPharma remarked, "This deal creates a compelling valuefor our shareholders. Undoubtedly, our companies are stronger collectivelythan we are individually and we look forward to leveraging our obvioussynergies to achieve greater shareholder value for all involved.
"With 3000 SKU's and over 5000 customers in its distribution-basedbusiness, Dynamic will expand and perfectly complement GeoPharma's alreadyflourishing manufacturing and distribution business segments. The combinationof our two companies will allow for meaningful savings that currently tax eachcompany as separate entities."
The company went on to state that the combined revenues of the twocompanies are expected to be in excess of $90 million on an annualized basis.Furthermore, the Company believes that the acquisition will be accretivewithin the first year of consolidated operations. Dynamic sales will begin tobe recognized by GeoPharma during the 3rd fiscal quarter ending December 31st,2007. Dynamic's revenues for the six months ended September 30, 2007 wereapproximately $29.2 million.
Dynamic has displayed significant revenue growth over the last few yearswith its revenues skyrocketing from approximately $16 million in its fiscalyear ending in March of 2005 to approximately $56.8 million in its fiscal yearended March 31, 2007. Recently, Dynamic was honored to be ranked number 9 inEntrepreneur magazine's (August 2007 issue) HOT 500 list depicting America'stop fast-growth businesses and the entrepreneurs who built them.
About GeoPharma, Inc:
GeoPharma, Inc. is a rapidly growing pharmaceutical company specializingin the manufacturing and distribution of over-the-counter, nutritional,generic drug and functional food products. GeoPharma manufactures, packagesand distributes private label dietary supplements, over-the-counter andgeneric drugs, as well as, health and beauty products for companies worldwide.This is accomplished by utilizing our four Florida-incorporated companies,Innovative Health Products, Inc., Libi Labs, Belcher Pharmaceuticals, Inc. andBreakthrough Engineered Nutrition, Inc. Innovative Health Products and LibiLabs specialize in the development and manufacturing of a broad range ofnutritional supplements and cosmeceuticals. As a private-label contractmanufacturer, we develop and manufacture for ourselves, and our customers,dietary supplements and health and beauty care products for distributionthrough various outlets. Belcher Pharmaceuticals, Inc is a state-of-the-artFDA-registered, drug development and manufacturing facility for generic andover-the-counter drugs.