DWHP Withdraws Second Offer for CCEL - Based on Board's Refusal to Engage in Discussions

Oct 15, 2010, 16:13 ET from DW Healthcare Partners, LP

PARK CITY, Utah, Oct. 15 /PRNewswire/ -- DW Healthcare Partners, LP (DWHP), a healthcare focused private equity firm with over $250 million in committed capital under management, today responded to the refusal of the board of directors of Cryo-Cell International, Inc. to engage in discussions regarding DWHP's all-cash offers to acquire the issued and outstanding Cryo-Cell shares at substantial premiums to market value. Given the Cryo-Cell board's refusal to meet with DWHP regarding the proposed transaction, DWHP has withdrawn its latest offer, which represented a 94% premium from CCEL's share price prior to DWHP's first offer.

"We are very disappointed that Cryo-Cell's board not only rejected our offer, but refused to even meet with us. We offered Cryo-Cell shareholders a substantial premium to the current stock price, as well as full liquidity in a thinly traded-stock. The board's refusal to engage in discussions regarding our offer raises serious concerns about the board's priorities. Our all-cash offer is extremely positive for Cryo-Cell shareholders. We note, in fact, that the shareholders appear to agree with our position, given the significant increase in the Cryo-Cell stock price since we made our initial offer. As such, we believe the board should have addressed our offer with Cryo-Cell shareholders. Given the board's refusal to engage in discussions with us, we have withdrawn our offer," said Andrew Carragher, Co-Founder and Managing Director of DWHP.

The following table sets forth the particulars of DWHP's offers to the Cryo-Cell board:

Date

DWHP

Closing

DWHP

Premium to Share Price


Offer

Price

Premium

at Original Offer

9/9/2010

$1.50

$0.90

67%

67%

9/27/2010

$1.75

$1.50

17%

94%



A copy of DWHP's latest offer, dated September 27, 2010, follows:

September 27, 2010


Mercedes Wilson

Chair of the Board and Chief Executive Officer

Cryo-Cell International, Inc.

700 Brooker Creek Boulevard

Suite 1800

Oldsmar, Florida 34677



Dear Mercedes:

We were extremely disappointed to receive your September 9th letter reporting the decision of the Cryo-Cell board to reject our August 30th offer without engaging in any discussions regarding the proposed transaction. We find it surprising that your board would simply reject a cash offer representing a 67% premium to the share price the day of our original offer. We are also disappointed that you have been unwilling to return my phone calls or engage in any dialogue regarding a possible transaction. Those actions do not appear to be in the best interests of Cryo-Cell stockholders, and raise significant concerns regarding your board's attention to its fiduciary duties to those stockholders – particularly in light of the public backlash by many shareholders about management and the stock's poor performance in recent years.

Notwithstanding your refusal to engage in discussions regarding the proposed transaction, we remain convinced that our offer represents the best option for the Cryo-Cell stockholders, allowing them to not only achieve full liquidity on a very thinly traded stock, but also a substantial premium to the current share price. Although we believe our original offer was favorable to Cryo-Cell stockholders, we are prepared to increase the amount of our offer, in an attempt to facilitate dialogue with you and the Cryo-Cell board regarding the proposed transaction.

This letter confirms our revised offer to acquire all of the outstanding shares of Cryo-Cell common stock at a purchase price of $1.75 per share in cash. The following table shows the significant premium offered by DWHP on a per share basis.

Date

DWHP

Closing

DWHP

Premium to Share Price


Offer

Price

Premium

at Original Offer

9/9/2010

$1.50

$0.90

67%

67%

9/27/2010

$1.75

$1.50

17%

94%



Our revised offer increases the premium to 94% over the closing price of the Cryo-Cell stock on the day of our original offer.

We hope you and the Cryo-Cell board will respond positively to our revised offer. As I indicated in our prior correspondence, we are prepared to fund the transaction through available equity capital from our existing DWHP Fund II, and the proposed transaction would not be subject to any type of financing contingency. Our proposal remains subject to reaching a mutually satisfactory definitive acquisition agreement and our completion of a satisfactory due diligence review. We would like to commence the due diligence and negotiation of an acquisition agreement as soon as possible.

We look forward to commencing a productive dialogue with you regarding the proposed transaction. Please contact me as promptly as possible to confirm your willingness to proceed with substantive discussions by 5:00 p.m. Eastern Time on Thursday, September 30, 2010.

Sincerely yours,

Andrew Carragher

Co-Founder and Managing Director

DW Healthcare Partners, LP

1413 Center Drive., Suite 220

Park City, Utah 84098

(435) 645-4053 – office

(435) 640-3543 – mobile

andrew@dwhp.com


CC: Ki Yong Choi, Scott Christian, Andrew J. Filipowski, Anthony P. Finch, Michael W. Cho, Sung Won Sohn,



About DW Healthcare Partners

DW Healthcare Partners is a private equity firm focused exclusively on the healthcare industry. The firm manages over $250 million in committed capital and invests in profitable healthcare companies with proven management teams. DW Healthcare Partners is led by seasoned healthcare executives with more than 100 years of combined industry experience. The firm provides the capital, strategic guidance, and acquisition expertise to help mid- to late-stage companies realize their potential for growth.

SOURCE DW Healthcare Partners, LP