Make us your home page
Instagram

Largo's GeoPharma lays off more workers as cash crunch intensifies

GeoPharma is on an urgent quest to borrow up to $10 million from a bank, hedge fund or other investor as a cash crunch within the 25-year-old Largo drug company intensifies.

Carol Dore-Falcone, senior vice president and chief financial officer, acknowledged Monday that the financial squeeze is taking a toll:

• About 25 more employees will be laid off this week, on top of 60 workers let go over the past two months.

• Some of GeoPharma's 190 employees have been paid sporadically over the past month. Some delayed payroll checks handed out last week covered the week of Dec. 24, and Dore-Falcone was trying to ascertain when she could release checks for the weeks ending Dec. 31 and Jan. 8.

• Without an injection of cash, the company doesn't have money to fully pay quarterly federal payroll taxes due Friday.

• GeoPharma's bank, First Community Bank of America, last month called in the company's equipment loan, which had a balance of about $650,000. At the same time, the bank called in a mortgage loan on a local condo held by the company; plus it froze a $305,000 CD held by the company and another $450,000 personal CD held by GeoPharma chairman Jugal Taneja.

"That had a drastic compounding effect on cash flow," Dore-Falcone said. "We're just continuing to plug on with our business plan as best we can."

Revenue has fallen significantly during the recession, but the company's problems were exacerbated by a soured relationship last year with a key investor, hedge fund Whitebox Pharmaceutical Growth.

GeoPharma blames Whitebox for not meeting its funding obligations to the company totaling about $5 million.

There are a few positive developments. GeoPharma's Web site was back online this week. After being dropped by Aetna, the company secured a new health insurer for its workers starting this month: Naples-based Self Insured Plans.

While not disbursing any funds, hedge fund Whitebox recently agreed to release liens on GeoPharma's building, inventory and accounts receivable. Dore-Falcone estimated the building has a fair market value of $2 million, its inventory about $5 million and its accounts receivable between $500,000 and $750,000.

"Add that together, and that's collateral of $8 or $9 million … to offer a hedge fund or a bank," she said. "I'm hoping someone will give me at least $5 million if not $10 million."

She said a bankruptcy filing was not under consideration at the moment, "but I'll have to evaluate things on a case by case basis."

Shares in GeoPharma fell another 8 percent Monday to close at 35 cents apiece.

Jeff Harrington can be reached at jharrington@sptimes.com or (727) 893-8242.

Largo's GeoPharma lays off more workers as cash crunch intensifies 01/11/10 [Last modified: Monday, January 11, 2010 7:47pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. Memorial Day sales not enough to draw shoppers to Tampa Bay malls

    Retail

    TAMPA — Memorial Day sales at Tampa Bay area malls were not enough to compete with the beach and backyard barbecues this holiday weekend.

    Memorial Day sales weren't enough to draw shoppers to Tampa Bay area malls over the long weekend. 
[JUSTINE GRIFFIN | Times]
  2. Austin software company acquires second Tampa business

    Corporate

    Austin, Tex.-based Asure Software acquired Tampa's Compass HRM Inc. late last week for $6 million. Compass focuses on HR and payroll.

    [Company photo]
  3. Hackers hide cyberattacks in social media posts

    Business

    SAN FRANCISCO — It took only one attempt for Russian hackers to make their way into the computer of a Pentagon official. But the attack didn't come through an email or a file buried within a seemingly innocuous document.

    Jay Kaplan and Mark Kuhr, former NSA employees and co-founders of Synack, a cybersecurity company, in their office in Palo Alto, Calif., in 2013. While last year's hacking of senior Democratic Party officials raised awareness of the damage caused if just a handful of employees click on the wrong emails, few people realize that a message on Twitter or Facebook could give an attacker similar access to their system. 
[New York Times file photo]
  4. Big rents and changing tastes drive dives off St. Pete's 600 block

    Music & Concerts

    ST. PETERSBURG — Kendra Marolf was behind the lobby bar of the State Theatre, pouring vodka sodas for a weeknight crowd packed tight for Bishop Briggs, the latest alternative artist to sell out her club.

    Sam Picciano, 25, left, of Tampa and Molly Cord 24, Palm Harbor shop for record albums for a friend at Daddy Kool Records located on the 600 block of Central Avenue in St. Petersburg, Florida on Saturday, May 20, 2017. OCTAVIO JONES   |   Times
  5. How Hollywood is giving its biggest stars digital facelifts

    Business

    LOS ANGELES — Johnny Depp is 53 years old but he doesn't look a day over 26 in the new "Pirates of the Caribbean" movie — at least for a few moments. There was no plastic surgeon involved, heavy makeup or archival footage used to take the actor back to his boyish "Cry Baby" face, however. It's all …

    This combination of photos released by Disney, shows the character Jack Sparrow at two stages of his life in "Pirates of the Caribbean: Dead Men Tell No Tales."  Johnny Depp, who portrays the character, is the latest mega-star to get the drastic de-aging treatment on screen
[Disney via Associated Press]