DellaCamera suggests ways for Enzon Pharmaceuticals to increase value for stockholders

By Lisa Kerner

Charlotte, N.C., July 1 - DellaCamera Capital Management, LLC demanded that the board of directors of Enzon Pharmaceuticals, Inc. take action to increase stockholder value.

The investor's comments were made in a July 1 letter to Enzon's board included as part of a schedule 13D filed with the Securities and Exchange Commission.

DellaCamera said it has been in contact with Enzon's financial advisers, as well as its lead independent director, to discuss the investor's ideas to increase the company's stock price.

However, the investor said that Enzon has failed to take action to address the company's under-valuation.

DellaCamera suggested a series of steps Enzon could pursue as one path to create value:

• Authorize an $80 million share repurchase program, to be implemented immediately;

• Pursue the monetization of a minimum of $70 million of the company's royalty streams;

• Increase authorization of the share repurchase program to a minimum of $150 million and continue to repurchase shares;

• Begin a process of soliciting bids for Enzon's marketed products and royalty segments;

• Start a process of establishing a wholly owned biotechnology subsidiary funded by a $75 million cash contribution from Enzon;

• Sell an equity stake of at least 19% in such biotechnology subsidiary either to a strategic partner or to a venture firm; and

• Investigate and effect a public "split-off" of the biotechnology subsidiary, whereby Enzon stockholders exchange shares of Enzon for shares of this subsidiary.

If the company does not "immediately and convincingly commit to increase stockholder value," DellaCamera said it may begin a public consent solicitation for the purpose of amending the company's bylaws to allow stockholders to have a stronger voice in overseeing the company, as well as asking stockholders to approve certain resolutions.

In May, DellaCamera said it was encouraged by the company's plans to spin off its biotechnology business but demanded Enzon explore strategic alternatives including a sale of all or part of its commercial operations, which includes its marketed products, royalties and manufacturing businesses.

It was previously reported that Enzon expected its spinoff to close in the fourth quarter of 2008.

The Bridgewater, N.J., biopharmaceutical company planned to keep the current marketed products of Abelcet, Adagen, DepoCyt and Oncaspar, the rights to current PEG royalty revenues and the manufacturing facility in Indianapolis.

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