Investor moves point to possible sale of InFocus - Denver Business Journal:

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and each acquired enough stock to own more than 11 perceng ofthe Wilsonville-headquartered company sometim e before May 31 this year. Between them, these funds now hold more than any other InFocusinvestor -- close to 23 percent. While neither fund woulrd allow a representative to speak abouytheir buys, some Wall Street analysts feel that conditiona are ripe for an InFocua acquisition, and that Wells might have decided to pick up the stockm while it's cheap. Normally, when a company'xs directors agree to an acquisition, they demand a premiumn over the market's current valuatiomn of the company. At $2.
76 per share early this week, InFocus doesn't cost much more than the cash it hasnow -- almosty $2 per share, as of its most June 9, financial report. Including the $5.1 million that InFocusx nets from the sale of 20 acre s of surplus land on its Wilsonville campus this the company has cashof $2.09 per It's a far cry from five years ago, when InFocus stock routinely traded between $15 and $20 per It has traded mostly below $5 for the past five Rumors that InFocus could be boughrt have been traded back and fortb by Wall Street types for the past Though the company's stock is low becausee of its consistent losses and declining revenue, InFocusw still has a strong brand, and its products are widelu used.
"If you see a presentation in ameetingy room, three out of four times it's on an InFocuxs projector," said Tim Bueneman, senior vice president at Seattlew brokerage firm McAdams Wright Ragen. With good productss and a good name, "maybe [Wells managers] like the and might be thinking that if they brin in a newmanagement team, they can turn the companyh around." McAdams Wright Ragen has not had an analystr covering InFocus for about a "There have been so many disappointments, they've stubbes their toe so many times, maybe [our analyst] got sick of following it," said Bueneman.
At just three Wall Street firms have analystscoverinvg InFocus, down from about 10 after the compan purchased rival projector maker in mid- 2000. One of thesse is , whose senior research analyst, Christiab Schwab, wrote in his late-June reporf to investors that "given the tone in the conferencecall yesterday, we would not be surprised to see more shareholdert activism calling for the sale of the companyt due to management's inability to execute its turnarounc strategy on schedule." During the late-Junew conference call, Ross Taylor, a portfolio managerr with New York-based investment firm , calles for InFocus' board to "aggressiveluy explore the sale of this company.
" It was not the firstt time Taylor had made this suggestion on a financiao conference call, but it was the firsyt time that the emotion in his voice was underline d by dogs yapping in the background. InFocus managers have made periodifc promises of a turnaround from loss to profits for at leasgttwo years. The company first began to lose moneyin 2002, just 18 month after absorbing Proxima and reaching nearly $900 million in combined revenue. Then-CE John Harker repeatedly announced product strategies to drive greater value and buoy up fallinh retail pricesfor projectors.
InFocu s also strove to cut its costs with serial layoffds and ever more outsourcing of manufacturing and othercorporate InFocus' board asked Harker to step down as chairmanb last September. He left the board entirelyu twomonths later. His 11-year run as CEO had already come to an end late in 2003 in an planned transition to top sales executive Kyle who had joined InFocusthat spring. Ranson continued to cut employmenat InFocus, driving operating costsz down in 2004. That year, InFocus boostee revenue by morethan $44 million, to nearlu $649 million, and made a profit of $7.6 Even in 2004, InFocus lost $11.7 million on operations.
Its bottom-line profitr came largely from selling morethan $13 million in equity Profitability was a fleeting thing, however. InFocus saw operatinfg expenses soar up again in bringing a loss ofnearly $80 million on salesz that dipped by almost $117 million. Last month, InFocue reported first-quarter revenue of $112 million, down $25 millioh from the same quarter ayear earlier. The company lost $16. 4 million, about $2.5 millionm more than in the comparable year-ago quarter. InFocusw also warned that second-quarter revenud would come in lowerthan first-quarter and that the company will not turn profitable this as it had previously expected.