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Filed Pursuant to Rule 424(b)(3)
Registration Statement No. 333-47637
SUPPLEMENT TO AGRIBIOTECH, INC.
PROSPECTUS DATED AUGUST 14, 1998
Acquisitions, Description of Other Indebtedness,
Recent Developments and Web-Site Disclosures is amended
to include the following information:
Chairman's Update
Dated: September 1, 1998
Dear Fellow Shareholders,
The past few weeks have been exceedingly difficult for shareholders. Our
press release (August 26, 1998) should reassure shareholders that the Company is
built on a strong foundation. Unfortunately, general uncertainties in the stock
market, predispose investors to look for reasons to sell.
Review of Fundamentals
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Management reminds shareholders of our focused vision to be the premier
forage and cool season turfgrass company in the world. A task which we have
accomplished in less than four years.
Shareholders are reminded that our criteria for "premier" is based on the
following list of attributes, what I consider "building franchise value".
. Industry leading market share.
. Industry leading germplasm.
. World class personnel.
. Biotechnology access and ownership of intellectual property.
Although we have achieved industry leading status in each of these areas of
the forage and cool season turfgrass sector, we will continue to build on this
already strong platform in each of these areas. Each agreement entered into by
the Company should be evaluated for how it enhances our strength in those
critical four areas.
New Acquisition/Funding
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The acquisition of Allied Seed Company and the private placement by
Fidelity Commonwealth Trust: Fidelity Small Cap Fund, Quantum Partners LDC, a
fund managed by Soros Fund Management, and the State of Wisconsin Investment
Board (press release dated August 31, 1998) are a continuation of "building
franchise value", primarily in increasing market share. Management will clearly
examine each potential acquisition to insure that its contribution to franchise
value will exceed the cost of capital.
AgriBioTech Comparisons
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In order to understand just how undervalued AgriBioTech ("ABT") is today,
it is useful to compare ABT today with ABT 12 months ago when our stock price
was below $10 per share and also compare ABT today with three other seed
companies, Delta and Pine Land, ("DLP"), Mycogen ("MYCO"), and Dekalb ("DKB") in
their respective sectors, as they are today.
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<TABLE>
<CAPTION>
ABT ABT
Characteristic 8/31/97 8/31/98 DLP MYCO DKB
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<S> <C> <C> <C> <C> <C>
Annualized Revenues 155 445 203 218 510
(millions) (1) (12 mo. 5/31/98) (12 mo. 5/31/98) (12 mo. 5/31/98)
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Estimated US Market 14% 40% 65% 4% 11%
Share (%) (2)
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Germplasm (quality and Good Excellent Excellent Average Excellent
quantity) (2)
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World Class Personnel Good Excellent Excellent Excellent Excellent
(2)
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Biotechnology Access None Three Excellent Excellent Excellent
(2) Agreements
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US Growth Excellent Excellent Limited Limited Limited
Opportunities (2)
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Profitable (1) No Yes Yes No Yes
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Shares Outstanding 24.9 39.2 38.3 36.3 34.9
(millions) (1) (June 29, 1998) (June 30, 1998) (May 31, 1998)
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Stock Price 8.50 8.625 42.9375 (3) 20.00 (3) 86.625 (3)
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(1) Based on information obtained from the Edgar filings.
(2) Based on assessment of ABT management.
(3) Last sale on August 31, 1998.
As I study the above comparisons, I can only conclude that ABT was closer to a
proper market valuation at our recent high ($29.50) then we are at yesterday's
close ($8.625). Biotechnology access is the only area where the peer group ranks
ahead of ABT. This gap should cease to exist in the near term.
Summary:
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The Company expects to action its plans to build franchise value, even in this
difficult and volatile stock market. Management will increase the time spent
introducing the Company to potential new investors and will take other
appropriate actions to regain an appropriate market valuation.
Sincerely yours,
Johnny R. Thomas
Chairman/CEO
Prospectus Supplement Dated: September 4, 1998
