A Medical Device Daily

Invitrogen (Carlsbad, California) and Applied Biosystems (AB; Foster City, California) reported that they have amended their pending $6.7 billion merger agreement to eliminate a condition to closing requiring that the parties receive certain opinions of their respective counsel as to the tax treatment of the transaction.

Under the prior terms of the merger agreement, completion of the merger was conditioned on the receipt of an opinion from each party's counsel to the effect that the merger will be treated as a tax-free reorganization under Section 368(a) of the Internal Revenue Code.

Given the unprecedented market conditions of the past few weeks, and the current trading price of Invitrogen's common stock, the parties determined that they might not be able to obtain the necessary opinions because of the relative value of the cash consideration to be received by AB stockholders as compared to the value of the stock consideration they will receive.

Applicable tax regulations generally limit the percentage of the consideration that can be paid in cash if the transaction is to qualify as a tax-free reorganization.

In order to allow shareholders of Invitrogen and AB more time to consider the merger agreement amendment, the parties have agreed to delay their previously scheduled special stockholder meetings in connection with the merger. The special stockholder meetings for both companies now will be held on Oct. 28.

Applied Biosystems will convene its scheduled special meeting today for the sole purpose of adjourning the meeting, and Invitrogen's special meeting scheduled for today will be postponed.

Both companies said they have received opinions from their respective counsel that, regardless of whether the merger qualifies as a tax-free reorganization, the merger will not be taxable to either company.

HealthTronics (Austin, Texas), a provider of urology services and products, reported that it has acquired Ocean Radiation Therapy (Daytona Beach, Florida), an entity that provides services to Atlantic Urological Associates' (AUA; also Daytona Beach) IGRT cancer treatment center, that it has issued updated 2008 guidance, and that its board approved up to $10 million of repurchases of HealthTronics common stock.

AUA is urology practice comprised of 13 physicians. The practice's IGRT center began operations in 2006. More than 250 prostate cancer patients are treated at the center annually.

James Whittenburg, president/CEO of HealthTronics, commented, "This transaction strengthens our position in the IGRT space by aligning HealthTronics with a prominent group of urologists and a cancer treatment center with strong historical profits. In addition to being accretive from day one, we expect to be able to leverage this acquisition to further fuel the momentum in our de novo IGRT development efforts."

HealthTronics also reported that its board has approved a plan to repurchase up to $10 million of the company's common stock. Under the repurchase program, HealthTronics anticipates that the stock will be repurchased through privately negotiated transactions or on the open market.

"While our primary objective continues to center on de novo development and strategic acquisitions, we believe instability in the equity markets may create opportunities to enhance value creation for our shareholders through disciplined repurchases that will produce long-term benefits for HealthTronics and its shareholders," said Whittenburg.

On Oct. 8, pursuant to the stock repurchase program, in a private transaction, the company repurchased 1.7 million shares of its common stock from Prides Capital Partners for an aggregate price of $3.74 million.

HealthTronics is a urology company providing a suite of healthcare services and technology including urologist partnership opportunities, surgical and capital equipment, maintenance services offerings, and anatomical pathology services.