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Jax Daily Record Tuesday, Sep. 29, 201512:00 PM EST

Cancer therapy firm calling Jacksonville home

by: Mark Basch Contributing Writer

Another public company is apparently calling Jacksonville home, now listing a Downtown office as its headquarters after moving from Seattle.

TapImmune Inc. describes itself as an “immunotherapy” company that is researching and developing treatments for cancer and infectious diseases.

Its move to Jacksonville is likely tied to its relationship with the Mayo Clinic’s facility in Jacksonville, which recently received a grant from the U.S. Department of Defense for a trial of a breast cancer treatment licensed by TapImmune.

TapImmune said Mayo Clinic also has a financial interest in the company, but TapImmune’s Securities and Exchange Commission filings do not list Mayo as holding 5 percent or more of its stock.

TapImmune has been headquartered in Seattle and it has not made any announcements about moving to Jacksonville, but its most recent quarterly report filed with the SEC last month listed its headquarters address as the 25th floor of the Bank of America Tower Downtown.

That space is leased by Regus, the company that sublets office space to small businesses.

TapImmune’s annual report filed in April said the company was leasing a 2,682-square-foot office in Seattle at the time on a month-to-month basis, and only had one full-time employee.

CEO Glynn Wilson did not respond to phone messages and the company also did not respond to a message sent through its website.

Wilson and the company did hold a conference call for investors two weeks ago after the announcement of the Mayo Clinic grant. The Defense Department is giving the clinic a five-year $13.3 million grant to test a vaccine intended to prevent the recurrence of a type of breast cancer.

The vaccine also has the potential to treat ovarian, endometrial and non-small cell lung cancer, TapImmune said.

“This news, as you can imagine, is a truly amazing step forward for the company,” Wilson said in the conference call.

TapImmune says it has several other medications under development but has no products on the market and has no revenue. It recently completed a recapitalization that brought in $5 million, which allows the company to increase its infrastructure, Wilson said.

Wilson said the government’s grant to Mayo came after a comprehensive peer review of its vaccine from experts in breast cancer research, which he considers “an independent validation of the strength of our technology and approach.”

TapImmune’s stock, which trades on the Over-the-Counter Bulletin Board under the ticker symbol “TPIV,” is priced below $1, but Wilson is optimistic the stock will rise even without any near-term revenue because investors and the scientific community are taking notice of the company.

“I believe soon the company’s valuation will reflect that awareness,” he said. “I can safely say this is not the same company as it was six months ago.”

BAE’s shipyards a small part of the business

BAE Systems’ announcement last week that it is cutting 200 jobs at its two Jacksonville shipyards is big news locally, but it’s just a blip in the company’s global business.

London-based BAE is known mainly as a global defense contractor. Its biggest splash locally was its $4.5 billion buyout of Jacksonville-based defense contractor Armor Holdings Inc. in 2007.

Armor was gaining notoriety for products built for the U.S. military, including armored Humvees.

While its headquarters office was in Jacksonville, its big-ticket military products were built elsewhere and its only local manufacturing business involved bullet-proof vests and other law enforcement equipment.

BAE wasn’t particularly interested in that business, which operated under the Safariland name, and in 2012 former Armor CEO Warren Kanders bought Safariland back from BAE.

Meanwhile, BAE got into the ship building and repair business in Jacksonville in 2010 by acquiring Atlantic Marine Holding Co., which operated shipyards in Mayport and on Heckscher Drive.

BAE said it employed about 800 people at those two locations before announcing its plan to cut 200 jobs in the coming months.

“The workforce reduction is to align our workforce with a decline in commercial shipbuilding work in North Florida. We also are experiencing reduced demand for Navy repair work at the Mayport Naval Station because of the Navy’s changes to its ship maintenance plan,” BAE said in a news release.

Along with the layoffs in Jacksonville, BAE also announced it is cutting 650 jobs at its shipyard in Norfolk, Va.

The company operates a total of seven shipyards in Alabama, Florida, California, Virginia and Hawaii.

However, the U.S. ship building and repair business accounted for about 5 percent of BAE’s total revenue in 2014. BAE reported revenue of more than 16 billion British pounds last year, or more than $24 billion.

BAE gets nearly a third of its sales from U.S. operations, mostly for defense contracting.

RBC Capital Markets analyst Robert Stallard said in a research report two weeks ago, after meeting with BAE Chief Executive Ian King, that the company is optimistic about the outlook for U.S. defense spending.

“Like its peers, BAE is notably more confident on the outlook for its largest market — the U.S. There is more visibility on the budget, and good growth prospects in certain areas,” Stallard said.

Stallard maintained an “outperform” rating on BAE’s stock, which trades on the London Stock Exchange.

“We see U.S. earnings pressures potentially abating as the budget begins to stabilize and improve,” he said.

Rayonier AM  extends one contract

While Rayonier Advanced Materials Inc. tries to resolve a dispute with its largest customer, it did last week announce an extension of its contract with its second-largest customer.

Jacksonville-based Rayonier AM, which produces cellulose specialties products, said it extended an agreement to sell its products to Nantong Cellulose Fibers Co. for four years, through 2019.

According to its annual report, sales to Nantong accounted for 18 percent of Rayonier AM’s 2014 revenue, second to the 31 percent of revenue in sales to Eastman Chemical Co.

Rayonier AM last month announced that it and Eastman had filed competing lawsuits over a dispute regarding interpretation of certain language in the sales contract behind the two companies.

That dispute is still unresolved and has battered Rayonier AM’s stock, because of uncertainty of how it will affect the large volume of sales to Eastman.

Rayonier AM said last week that it expects annual volume of sales to Nantong will be comparable to recent levels under the contract extension.

St. Joe buys back  16.5 million shares

The St. Joe Co. last week said stockholders tendered about 16.5 million shares in the company’s offer to buy back shares at $18 each. St. Joe had offered to buy up to 16.67 million shares.

The share buyback reduces the number of shares outstanding for the company to about 75 million. That means that St. Joe Chairman Bruce Berkowitz now controls a greater share of the company.

His investment firm, Fairholme Capital Management, controlled about 24.6 million St. Joe shares before the stock buyback, representing 26.8 percent of shares outstanding. With the reduced number of shares outstanding, Berkowitz’s stake increased to 32.7 percent.

The tender offer by St. Joe did increase the company’s stock price. It was trading at $16.89 when the company announced the buyback at $18 a share a month ago, but the price increased to $17.84 by the time the tender offer expired Wednesday.

Remy shareholders approve buyout

Shareholders of Remy International Inc. last week approved the company’s proposed $1.2 billion buyout by BorgWarner Inc.

The merger of the two auto parts manufacturers was announced in July. BorgWarner agreed to pay $29.50 a share to buy Remy and Remy’s stock has traded as high as $29.73 after the deal was announced, indicating investors were betting on a higher offer.

However, no other offers came in and 99 percent of shares were voted in favor of the BorgWarner offer, according to an SEC filing by Remy.

Indiana-based Remy was formerly controlled by Jacksonville-based Fidelity National Financial Inc., but Fidelity spun off its majority interest at the end of 2014.

BorgWarner and Remy expect to complete the merger in the fourth quarter.

J. Alexander’s to begin trading

Speaking of Fidelity spinoffs, restaurant company J. Alexander’s Holdings Inc. is scheduled to begin trading Tuesday on the New York Stock Exchange.

Fidelity is distributing its 87.4 percent stake in J. Alexander’s to shareholders of Fidelity National Financial Ventures, the tracking stock that holds Fidelity’s non-real estate-related investments.

J. Alexander’s will trade under the ticker “JAX.”

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