A Medical Device Daily
HealthSouth (Birmingham, Alabama) reported that it has finalized the issuance and sale of 8.8 million shares of common stock of the company to J.P. Morgan Securities for net proceeds of about $150 million.
The company said it would use the net proceeds of the offering primarily for redemption and repayment of short-term or long-term borrowings. Amounts not used to reduce debt will be used for general corporate purposes including acquisitions of or investments in businesses or assets, capital expenditures, and working capital.
"The closing of this transaction represents another step taken to continue to reduce our total debt outstanding, deleverage our balance sheet, and reduce our cash interest obligations," said HealthSouth President/CEO Jay Grinney. "By doing so, we will be able to apply more of the cash that our business generates to invest in growth opportunities and for other general corporate purposes."
HealthSouth is the nation's largest provider of inpatient rehabilitation services. Operating in 26 states across the country and in Puerto Rico, HealthSouth serves more than 250,000 patients annually through its network of inpatient rehabilitation hospitals, long-term acute-care hospitals, outpatient rehabilitation satellites, and home health agencies.
In other financing news:
• Precision Optics (Gardner, Massachusetts) reported that it has completed a private placement of 10% senior secured convertible notes and warrants raising gross proceeds of $600,000.
The company issued $600,000 in aggregate principal amount of the notes, which notes may be converted into 12 million shares of common stock, par value $0.01 per share, at a conversion price of $0.05 per share, and warrants to purchase an aggregate of 7,920,000 shares of common stock at an exercise price of $0.07 per share. The notes may not be converted and the warrants may not be exercised until certain conditions have been met.
Precision Optics, a developer of advanced optical instruments, designs medical instruments, micro-optics with characteristic dimensions less than 1 mm, and other advanced optical systems. The company's medical instrumentation line includes laparoscopes, arthroscopes and endocouplers, as well as a line of 3-D endoscopes for use in minimally invasive surgical procedures.
• Southern Home Medical Equipment (Lyman, South Carolina) said it had completed a 1-for-1,000 reverse stock split. Effective at the open of the market last Friday, the company began trading on a reverse split basis under its newly assigned "SHOM" symbol on the Pink Sheets.
Greg Tucker, president/CEO of Southern Home Medical, said, "This reverse split is part of our overall strategy to create a more favorable capital structure as we pursue the expansion of our Encore Medical Staffing franchise. The number of Southern Home common shares outstanding has been reduced from 2,044,249,015 to 2,044,249 shares. With a higher share price and more manageable share count, we are better positioned to attract and retain long-term investors, including institutional investors. We also are moving closer to our goal of becoming a fully reporting company to further increase our visibility and value."
Southern Home Medical is a holding company with a focus on nurse staffing operations.