A Diagnostics & Imaging Week
Nanogen (San Diego), a developer of in vitro diagnostic products, said it has received permission to investigate alternatives to its previously reported merger with the Elitech Group (Paris).
Nanogen reported in August that it had agreed to combine its business with Elitech, a French diagnostics company, in an all-stock deal. The merger was expected to close by the end of 1Q09.
Nanogen said Elitech agreed to waive the restrictions in the agreement related to Nanogen's right to investigate alternatives because both companies believe it is unlikely that closing conditions will be met by March 31.
In consideration of the waiver, Nanogen agreed to waive Elitech's obligations to prepare the audited and unaudited financial statements to be included in Nanogen's SEC filings for stockholder approval. Instead, Elitech agrees to use reasonable commercial efforts to prepare such financial statements and may suspend or terminate such preparation if it deems it commercially reasonable to do so.
In addition to working to complete the merger with Elitech, Nanogen said it would also actively explore alternatives, including but not limited to a restructured transaction with Elitech, a transaction with a different entity, a sale of assets or a significant equity infusion.
Nanogen said that both companies believe it is unlikely that Nanogen will have obtained stockholder approval or that, given the current financial market conditions, the companies will have arranged for working capital financing by March 31, both of which are closing conditions to the merger. If the merger is not closed by March 31, each of the companies has the right to terminate the agreement.
In order for Nanogen to solicit the approval of its stockholders, Elitech must prepare and provide to Nanogen for inclusion in its SEC filings certain financial statements. Elitech has not completed the required financial statements and the timing for completing these financial statements is uncertain, Nanogen said.
In addition, under the terms of convertible notes issued by Nanogen in 2007 and 2008, the failure of Nanogen to commence solicitation of stockholder approval by Feb. 1 will reinstate Nanogen's obligations to make certain interest and redemption payments, which are currently deferred.
In other dealmaking activity:
Abbott Laboratories (Abbott Park, Illinois) has begun its cash tender offer for all outstanding shares of common stock of Advanced Medical Optics (AMO; Santa Ana, California) for $22 per share.
Abbott reported its intent to acquire AMO earlier this month for $2.8 billion in cash, including debt.
Consummation of the tender offer is conditioned on the tender of a majority of the outstanding shares of AMO's common stock on a fully diluted basis, as well as receipt of antitrust clearances and other conditions that will be specified in the offer documents. Following completion of the tender offer and, if required, receipt of stockholder approval, Abbott said it expects to consummate a merger in which remaining AMO stockholders will receive the same per-share cash price as paid in the tender offer.
As part of the transaction, Abbott has entered into tender and support agreements with ValueAct Capital Master Fund, ValueAct Capital Master Fund III, G. Mason Morfit and James V. Mazzo, according to which those stockholders have committed to accept the tender offer and to tender all AMO shares owned by them, representing about 12.5% of AMO's outstanding shares on a fully diluted basis.
AMO is comprised of three segments: cataract surgery, laser vision correction (LASIK), and eye care products.
The boards of both companies have already approved the deal and the companies expect the transaction to close this quarter.
• Moog (East Aurora, New York) said it has acquired the stock of Ethox International (Buffalo, New York) for $15.2 million in cash.
Ethox is a medical products manufacturer and service provider. The company produces proprietary medical devices and is engaged in contract manufacturing of disposables for many of the industry's leading medical device companies, according to Moog.
Ethox, which also provides microbiology, toxicology, and sterilization services, had 2008 revenues of $27 million.
Moog entered the medical devices market in 2006 with the acquisition of Curlin Medical, a manufacturer of electric ambulatory infusion pumps. Since then, Moog has acquired the McKinley product line of disposable pumps, Zevex enteral feeding pumps, and most recently Aitecs syringe pumps, resulting in a full-range product offering of infusion therapy equipment.
In addition to the pumps, Moog produces the disposable administration sets which are consumed every time a pump is used. These disposables are produced and sterilized in FDA-approved facilities. Ethox has a full complement of these FDA-approved facilities in addition to microbiology and toxicology laboratories.
"The acquisition of Ethox broadens our product base in disposables," said Martin Berardi, president of Moog's Medical Devices Group, "and brings to our company an experienced management team and substantial production capabilities."
The acquisition is expected to be neutral to Moog's earnings per share for the fiscal year ending Oct. 3, 2009, due to first-year purchase accounting adjustments.
Moog is a manufacturer of precision control components and systems for military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, marine and medical equipment.