A Medical Device Daily
Air Products (Lehigh Valley, Pennsylvania) said it has sold its U.S. healthcare businesses, A&J Care and COPD Services, to Landauer Metropolitan (Mount Vernon, New York), a provider of durable medical equipment, respiratory and infusion services.
Financial terms were not disclosed.
Air Products reported in July its plans to sell its U.S. Healthcare business and begin reporting the business as a discontinued operation and that it would record an impairment charge of roughly $315 million ($237 million after-tax) in its 3Q08 results (Medical Device Daily, July 24, 2008).
At that time, the company said it had reached preliminary agreement to sell A&J Care's metropolitan New York operations in Glendale and Peekskill and COPD Services' New Jersey operations in Runnemede, Cape May Courthouse and Cedar Grove. The 180 employees associated with those businesses have been offered employment with Laundauer Metropolitan, the company said.
Air Products serves customers in industrial, energy, technology and healthcare markets worldwide with a portfolio of atmospheric gases, process and specialty gases, performance materials, and equipment and services.
In other dealmaking activity:
• North American Scientific (NAS; Chatsworth, California) said it has sold its non-therapeutic product line to Eckert & Ziegler Isotope Products (Berlin).
NAS first disclosed the $6 million deal last week (MDD, Sept. 4, 2008).
"We have successfully closed this transaction in the expected time frame and we are now focused on the therapeutic areas of our business with our Prospera and ClearPath product lines for local radiation treatment for the prostate and breast cancer patient," said John Rush, president/CEO of NAS. "The proceeds from the sale of this product line will provide the company with important non-dilutive capital to invest in ongoing operations."
NAS provides radiation therapy products for treating cancer. Its products, Prospera brachytherapy seeds and SurTrak needles and strands, are used primarily in the treatment of prostate cancer.
• BPO Management Services (Anaheim, California) reported its plans to acquire Healthaxis (Irving, Texas). Healthaxis will become the healthcare division of BPO, complementing its existing operations for human resources outsourcing consulting, enterprise content management, and IT infrastructure outsourcing, BPO said.
Healthaxis provides technology-enhanced, integrated business process solutions and services, including claims and benefit administration applications, web-enabled software solutions and outsourced claims related services for health benefit administrators and health insurance claims processors.
The combined company is projected to have an annual revenue run rate of roughly $50 million, more than 400 customers, in excess of 350 employees, and operations in the U.S., Canada, Jamaica, India and Russia.
According to the deal, structured as a reverse merger, each share of BPO common stock will be exchanged for 0.3393 shares of Healthaxis common stock, while shares of BPO preferred stock and other BPOMS securities will be exchanged for a mix of shares of Healthaxis common stock, preferred stock and other securities based on various fixed exchange ratios.
On a fully diluted basis, BPO securityholders will own about 80% of the resulting company and Healthaxis securityholders will own about 20% of the company. Healthaxis will effect a reverse stock split in connection with the closing of the transaction, and the surviving public company's capital structure will be significantly streamlined in comparison to that of either predecessor company.
The surviving company will be re-named BPO Management Services, Inc. Patrick Dolan, the current CEO and chairman of BPO, will become CEO and chairman of the merged companies and John Carradine, CEO of Healthaxis, will oversee the company's healthcare operations offerings as managing director of the Healthcare Division.
• Amedisys (Baton Rouge, Louisiana) said it has signed a purchase agreement to acquire six home health locations from Home Health Corporation of America (King of Prussia, Pennsylvania). The agencies are in Pennsylvania, Maryland and Delaware with two agencies per state. The six agencies had revenue of about $23 million for the twelve months ended June 30, but is not expected to add significantly to Amedisys' earnings in 2008.
• Pediatrix Medical Group (Fort Lauderdale, Florida) said it has expanded its national group practice of neonatal physicians with the acquisition of a practice based in Alexandria, Louisiana.
The practice, which covers the Level III regional neonatal intensive care unit at Rapides Regional Medical Center, has volume of about 8,000 annual patient days, and has grown in recent years along with economic development in the region.
Pediatrix said it paid for this practice acquisition with cash and expects it will contribute to earnings immediately. During 2008, Pediatrix has acquired eight physician group practices, including neonatal, maternal-fetal, pediatric cardiology and anesthesia practices.