A Medical Device Daily

Microtek Medical Holdings (Alpharetta, Georgia) reported that it has received early termination of the U.S. antitrust waiting period in connection with its pending acquisition by Ecolab’s (St. Paul, Minnesota) for $275 million that was first disclosed last month (Medical Device Daily, Aug. 9, 2007).

Both companies’ boards have unanimously approved the transaction, which is expected to close in 4Q07.

Microtek, which makes surgical drapes, fluid control and other surgical supplies, will be combined with Ecolab’s existing hand-hygiene, medical-instrument and environmental cleaning and disinfecting business.

In other dealmaking news:

• Zotec Partners (Indianapolis) said it has merged with EmPhysis Medical Management (Rockwall, Texas), a provider of physician practice management for radiology, anesthesiology and pathology. Terms of the deal were not disclosed.

“We set out looking for the best technology solution we could find to improve our business, while strengthening our clients’ ability to utilize critical data. We found Zotec to be that solution,” said John Brochu, co-founder of EmPhysis Medical Management. “During the due diligence phase of licensing the software, both companies quickly realized that we bring unique attributes to the table and would be much stronger as a fully integrated unit. With Zotec’s technology and our unmatched client service delivery model, we are setting the course to be the premier company in our industry.”

The newly merged company’s headquarters will remain in Indianapolis, where Zotec has been based for 9 years. It said it will now service more than 5,500 physicians across more than 44 states.

Zotec provides medical billing services and licensed software to hospital-based physician specialty practices across the U.S.

Arrow International (Reading, Pennsylvania) said it sent another letter to shareholders urging them to vote on the white proxy card for its planned $2 billion ($45.50-a-share) all-cash acquisition by Teleflex (Limerick, Pennsylvania) and to re-elect the Arrow board, who it said are “committed to completing the Teleflex transaction and delivering $45.50 per share of Arrow common stock to shareholders once the merger is consummated.”

The annual meeting is scheduled to occur on Sept. 20.

In its letter, Arrow said that if a shareholder is in favor of the Teleflex transaction “it is in your best interests to vote to re-elect your current board of directors.”

The company urged shareholders not to add risk by voting for the McNeil Trust

“There is no need to add uncertainty to the merger closing process by electing new directors, as the McNeil Trust is attempting to do. The McNeil Trust opposed the strategic alternatives process from the beginning and voiced support for the merger only after the transaction was publicly announced. We do not think it is in your best interest to allow nominees of a shareholder who is not committed to completing this merger handle any issues that may arise between the approval of the merger agreement and the closing of the transaction.”

Arrow, a manufacturer of disposable catheters and related products for critical and cardiac care, has recently been troubled by profit shortfalls and agreed to the merger with Teleflex in July (MDD, July 24, 2007).

In June Arrow essentially put up the “for sale” sign by dismissing its CEO Carl Anderson Jr. and reporting the formation of a committee to “explore alternatives.”

The company said that it had “lost confidence” in Anderson’s leadership after four years at the helm and that during that time it had “failed to meet ... sales and earnings targets” set by him. That announcement also was accompanied by a report that it was facing a potential takeover by the McNeil Trust which was offering an alternate slate of directors.

Bausch & Lomb (B&L; Rochester, New York) reported that four independent U.S. proxy advisory firms, Institutional Shareholder Services (ISS), Egan-Jones Proxy Services, Glass Lewis & Co. and Proxy Governance, have each recommended that B&L shareholders vote for the proposed $3.67 billion merger with affiliates of Warburg Pincus at the company’s Sept 21 special meeting.

“The recommendations of four leading independent proxy advisory firms confirm our board of directors’ unanimous view that the transaction with Warburg Pincus delivers significant cash value and is in the best interests of Bausch & Lomb and all of our shareholders,” said Ronald Zarrella, CEO/chairman of B&L.

In May, B&L agreed to the transaction that valued the company’s stock at $65 a share in cash (MDD, May 25, 2007).

Rival ophthalmology company AMO (Santa Ana, California) made a late play for the company, offering $4.2 billion, but the $75-a-share offer was comprised of $45 in cash and $30 in AMO stock was not supported by the B&L board and AMO withdrew its offer last month (MDD, Aug. 2, 2007).

• AdCare Health Systems (Springfield, Ohio) and Family Home Health Services (FHHS; Addison, Illinois) reported the termination of a certain definitive merger agreement previously disclosed on June 6 without further obligations on either party.

The companies said the decision to terminate the agreement followed an indication of a majority of Family’s preferred Series A shares that they would not currently support the merger transaction.

The parties further reported that David Tenwick, Adcare’s chairman, has agreed to join the board of FHHS.

Tenwick said: “The logic of combining AdCare and Family remains valid. We are hopeful that AdCare and Family will develop a closer relationship in the future, and I look forward to joining their board and working with Family’s management team.”

Dominick and Dominick and Capital City Partners advised the parties on the transaction.

AdCare develops, owns and manages assisted living facilities, nursing homes and retirement communities and provides home healthcare services.

No Comments