MedImmune plans 3-for-1 stock split

Company's shares up with rest of industry

Biotechnology

February 18, 2000|By William Patalon III | William Patalon III,SUN STAFF

MedImmune Inc., the Gaithersburg biotechnology firm whose shares have soared in the current biotech rally, said yesterday that it would split its stock three-for-one.

The split, which is contingent on shareholder approval, would increase the number of authorized shares from 120 million to 320 million. Shareholders will vote on the measure at the company's May 18 annual meeting. If approved, the split will take effect at the close of business that day, with the extra shares being distributed to shareholders June 2, the company said.

As of Dec. 31, MedImmune had 67.9 million shares outstanding.

After yesterday's announcement, MedImmune's shares gained $10.75 to close at $192 after climbing as high as $204. The shares have risen 256 percent over the past year.

The company posted a $68.7 million profit in 1999, largely driven by sales of its flagship product, Synagis, which prevents a respiratory infection in infants. It recently won approval to operate a new manufacturing plant near Frederick.

"MedImmune continues to believe that an expanding shareholder base is an essential element of sustained corporate growth," Dr. Wayne T. Hockmeyer, the firm's chairman and chief executive officer, said yesterday.

"We have seen significant growth in shareholder value since our previous stock split, and hope that this split will make it possible for many more people to be a part of the continued growth of both the company and the biotechnology industry."

MedImmune last split its stock -- two-for-one -- on Dec. 31, 1998.

Companies split their shares to make them more affordable. But stock splits are controversial among the gurus of the financial markets. Stock-split naysayers say the measure is a wasted exercise, since it really doesn't change the company or its financial performance.

However, studies show that companies that split their shares tend -- as a group -- to outperform both their peers and the stock market in general.

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