Apparently VeriChip (of Digital Angel fame) is having difficulties. Digital Angel / VeriChip are behind much of the big push for branding humans and other species with RFID tracking devices as with NAIS. As one intelligence source put it this means there may still be hope for the human race.
VeriChip to Place Implantable Division on Block Once the RFID systems provider completes the recently announced sale of its Xmark subsidiary, it plans to sell the rest of its assets.
May 20, 2008 — VeriChip Corp., a provider of RFID systems for health-care and asset-tracking applications, has hired investment banking firm Kaufman Bros. to assist in the sale of its VeriMed Health Link business, as well as the possible sale of the entire company.
Jay McKeage, VeriChip’s VP of business development, believes Kaufman will “shop the VeriMed business around widely,” and that if the VeriMed business sells, another buyer could purchase the remainder of the company, which would then be “a shell of a quoted company.” The buyer could then operate as a public company, he says, or “buy it and stop filing with the SEC.”
Last week, VeriChip announced a $45 million definitive stock purchase agreement with tool and security firm The Stanley Works for the sale of VeriChip’s wholly owned Canadian subsidiary, Xmark, which sells RFID-based products and services designed to help track infants in hospitals, as well as other patients and physical assets. The deal is currently pending approval from VeriChip shareholders, and is expected to be completed by midyear.
Applied Digital Solutions (doing business as Digital Angel) owns 48.2 percent of VeriChip’s stock, and has stated its intention to approve the Xmark deal. According to McKeage, the Xmark business has been “nicely profitable” to VeriChip, as well as for Digital Angel, and has generated cash flow that funds the other half of VeriChip’s operations—VeriMed Health Link. “That [VeriMed] business has a substantial cash burn,” he says, “so once Xmark is sold, [VeriMed] is not sustainable on its own.”
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Last month, VeriChip rebranded its VeriMed system, renaming it Health Link, and launched a three-month advertising campaign to market its services directly to potential end users in southern Florida (see VeriChip Markets Its Implantable RFID Tags and Services Direct to Consumers). According to Scott Silverman, VeriChip’s CEO and chairman, the initiative included a partnership with hearing care provider HearUSA, with a goal of signing up 1,000 new customers.
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After VeriChip went public in February (see VeriChip Launches IPO), VeriTrace generated the first revenue for the company’s implantable division. And in its financial report for the first quarter of 2008, the Delray Beach, Fla., firm indicated that its losses shrank. It lost $2.8 million, or 30 cents per share, on revenue of $8.6 million. In the prior-year quarter, it lost $3.3 million, or 47 cents a share, on revenue of $7.1 million. What’s more, its gross profit was up by 5.4 percent.VeriChip’s implantable business, however, only generated $3,000 in revenue in the quarter ending March 31, 2008, during which the company saw a $1.9 million loss. According to a press statement released by Stanley, Xmark generates annual revenues in excess of $30 million, so without that revenue, VeriChip’s implantable business would be unsustainable.
When the Xmark sale is complete, VeriChip plans to use the $45 million from Stanley to pay outstanding debt, then utilize $15 million of the remaining $21.4 million to pay shareholders a special dividend. If the firm sells the VeriMed business or the whole of VeriChip, it plans to propose a second, special dividend to its stockholders consisting of all remaining distributable cash then held by VeriChip.
Privacy advocates have long complained that VeriChip’s implantable tag could put consumers’ personal privacy at risk, proposing that the tags could be read without a carrier’s knowledge. A news report released last fall, linking implanted RFID transponders to tumors in lab mice, caused additional public relations hurdles for the company (see VeriChip Defends the Safety of Implanted RFID Tags).
-RFIDJournal
If you’re looking to get in on the ground floor of a flailing industry now is the time. Oh, my but how the mighty are falling…
Hat tip to Mary.
Out of curiousity I wonder where the records of implanted “subjects” will go once the cancer causing, er I mean the Implantable Chip Division of VeriChip is bought by a Chinese subsidiary, through an American registered holding company. I’m sure the USDA, Secretary Chertoff of Homeland Security and the next royalty of the US will tell us the records will be safe….with the Chinese company, who will probably be the same one we buy our Gluten and lead painted toys from.
Comment Steve Ainsworth — May 26, 2008 @ 6:53 pm
Be very careful of any early celebrating over this situation….as in whoever could buy the company might be worse than who owns it now!!!!!
Comment SUSAN — May 26, 2008 @ 6:59 pm
maybe the feds will bail them out,maybe they will just buy the company out right,what does money mean to them anyway,maybe they will just take it out of the budget that fund the school systems or the budget that takes care of the wounded service men and women,who knows what the feds will do to id animals and people with some sort of implant or tag. when will america wake up?
Comment nick — May 26, 2008 @ 8:36 pm
This is fantastic! I have been talking to folks about this for years. Most act like this is just another conspiracy theory. Sheeple!
There is hope!
John
Comment John Two Crows — May 27, 2008 @ 4:52 am
I agree with those who have commented that it is too early to celebrate too much. Iridium was a scheme to encircle the whole earth with satellites in order to be able to track cellphone users anywhere on earth and to assign everyone a lifetime phone number. They lost huge amounts of money, then the Defense Dept. bought the company. This was undoubtedly planned all along. The insertable chips aren’t going to go away. Cellphones are tracking devices, listening devices (on or off), behavior modification devices, health and safety hazards, and thought prevention devices all in one. Many people even attach them to their ears and walk around like cyborgs. The fact that so few people have rejected these Big Brother devices is a strong indication that insertable chips aren’t far off for the masses.
Comment John Hinton — May 27, 2008 @ 7:34 am
This video is slightly off topic, but since the phrase “another conspiracy theory” was used, I do not think it inappropriate. In fact, if you get to the heart of the matter, chipping animals, chipping people, exportation of American jobs, the impending depression, it is all the work of the same people. Please watch:
http://www.youtube.com/watch?v=TShPYA-OuPs Time grows short.
Comment Pat H — May 27, 2008 @ 7:45 am
LMAO - wringing my hands in anticipation… Not jumping for joy, though. Just leaves more room for the couple other companies to profit from their demise……. Will be interesting to see what connection the new owner already had with this company -
Sue
Comment GrannySue — May 27, 2008 @ 9:20 am
I’d take a wait and see on this one whether it is a good thing or not. It’s easier to keep track of things when they are all in one basket. Take all those things and scatter them around the globe and things get much more difficult to follow.
Comment Scott — May 27, 2008 @ 9:22 am
Something smells a little like a raunchy rat. Yes, a little ray of hope but the wind is still blowing and the smell is beginning to get a little thick. The U.S. has delved out too much money and has too big of plans for the sheeple for the RFID to be over this easy. The government wants control of everything and this is their opportunity to get it. The government has scientists that are not stupid by any means and they will find a way to satisfy the status quo by altering the compounds and components to where cancer cannot be found in lab mice, without telling the sheeple that something else will be found. I’m not looking forward to when that happens. Let the government officials, their families and pets be the first to receive the chip. Me and mine will not follow suit but it would be interesting to see who in the government will and will not comply.
Comment Leigh Wright — May 27, 2008 @ 10:06 am
I have a theory. Companies dump product lines and subsidiaries if they think there is some scary risk. RFID chips cause cancer. This has been established. VeriChip has been responsible for implanting RFID chips in people as well as animals. Ergo Verichip may fear they will be accused in court of causing cancer. Remember lawsuits in the billions of dollars that companies lost over asbestos, lead paint, teflon, tabacco, etc? Well cancer causing implanted RFID chips may be the next big thing in class action lawsuits. Verichip and digital angel may simply be trying to exit the market before they have to pay up.
Comment Leah — May 27, 2008 @ 12:05 pm
Sure hope comment #10 is correct but like I found out about mattresses….they promise you the most restful sleep BUT get around that by not guaranteeing your personal comfort level so if you buy a mattress that is uncomfortable and even hurts your back you are stuck….AND because of govt mandates saying mattresses must be flame retardent dangerous chemicals are used to make mattresses.
Thus, chip companies will most likely be looking for a legal doublespeak way around the possible risks of cancer also. Just like other companies, they are out to survive and make money for their stock holders.
Comment SUSAN — May 28, 2008 @ 5:11 am
World Dairy Diary
Here is another place that is pro(?) NAIS that needs comments about why NAIS is not good. Henwhisper left a comment as did I. There are several short articles about NAIS.
Comment SUSAN — June 3, 2008 @ 5:53 am