Financially troubled Magna-Lab has ceased operations and has vacated its Edgewood, NY, manufacturing and office facility. Negotiations are under way to sell the developer of niche MRI scanners, according to vice president of marketing John Haytaian.The
Financially troubled Magna-Lab has ceased operations and has vacated its Edgewood, NY, manufacturing and office facility. Negotiations are under way to sell the developer of niche MRI scanners, according to vice president of marketing John Haytaian.
The company's status began unraveling this year when manufacturing operations were halted and 16 of 21 employees were laid off at the end of March, Haytaian said (SCAN 4/2/97). Most of the company's remaining business is handled by CEO Lawrence Minkoff and CFO Kenneth Riscica. Minkoff did not respond to phone calls.
According to a report filed with the Securities and Exchange Commission in April, the company adopted a restructuring plan that calls for the elimination of production, marketing, and some system engineering capability by strengthening its existing relationship with Elscint Cryomagnetics. Magna-Lab was notified by Elscint that if the Elscint proposal was not finalized by May 30, Elscint could seek to terminate the relationship. The two companies signed an agreement in June 1996, giving Elscint the exclusive right to market Magna-Lab's Magna-SL dedicated extremity MR scanner in certain international markets. Elscint was also expected to manufacture the 0.4-tesla system at its Fort Collins, CO, plant. Negotiations to finalize details of the agreement continued into March.
The Elscint agreement was still in place as of June 20, according to Haytaian. But more discussion is needed to work out how the relationship will proceed given that Magna-Lab is no longer manufacturing.
"Things are different in that Magna-Lab may take a different form going into the future," he said.