Aceto shares plunge after 'strategic review' announced

Shares in Aceto Corp. fell more than 64 percent on Thursday, a day after the Port Washington drugmaker announced plans to sell itself or some of its divisions in the face of falling product prices.

Aceto shares closed down $4.74, or 64.05 percent, to $2.66 on the Nasdaq Stock Market. They had closed up 3 cents to $7.40 on Wednesday before the company issued a news release on the possible sale.

The stock had traded above $17 in early August.

Aceto manufactures and sells chemicals, generic drugs and drug ingredients. In recent years it has greatly expanded its production of generic drugs by purchasing other companies and product lines.

Aceto has hired the investment bank PJT Partners and Lowenstein Sandler LLP attorneys, both in Manhattan, “to assist” in a “strategic review process” that could include “the sale of key business segments, a merger or other business combination with another party, continuing as a stand-alone entity or other potential alternatives,” Aceto said on Wednesday.

The company also said it expects to take a noncash charge of $230 million to $260 million because some drugs are selling for lower prices than executives had projected.

Aceto said its chief financial officer of two months, Edward Borkowski, has resigned and negotiations with lenders are continuing for a waiver of loan covenants.

The company employed 286 as of June 2017, according to a securities filing.

By James T. Madore

james.madore@newsday.comJamesTMadore

James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.