Cantel Medical (Clifton, New Jersey) and Minntech (Minneapolis, Minnesota) said they have entered into a definitive agreement for Cantel to acquire Minntech in a stock-for-stock deal valued at about $70 million. Under the terms of the agreement, each share of Minntech will be converted into the right to receive $10.50, consisting of $6.25 in cash and a fraction of a share of common stock of Cantel having a value of $4.25, based on the average closing price of Cantel stock during a defined period ending shortly before the merger. The transaction, which will result in a company with about $125 million in annual revenues, has been approved by the boards of directors of both companies, and is expected to be completed during 3Q01. Cantel said the acquisition is part of its strategic plan to further solidify its position as a leader in infection control and medical device reprocessing. Minntech is a maker of disinfection/reprocessing systems for renal dialysis as well as filtration and separation and other products for both medical and nonmedical applications. James Reilly, Cantel president and CEO, said Minntech has "a robust technology platform that will enable Cantel to address a broader range of infection control needs as well as to develop a host of new products for other medical and industrial filtration uses." He said the acquisition "opens new growth markets" to Cantel. Minntech markets a wide variety of medical device reprocessing and fluid filtration and separation products for the renal dialysis, medical device disinfection, cardiosurgery, pharmaceutical, biotechnology and semiconductor industries. Cantel said it plans to retain Minntech's operations in Minneapolis.
Cardiac Science (Irvine, California) said that its planned acquisition of Artema Medical AB (Stockholm, Sweden), a maker of patient monitors and defibrillators, has been delayed by U.S. regulatory requirements. Senior managers of both companies said they are to seek completion of the transaction. Raymond Cohen, president and CEO of Cardiac Science, called this "top priority" for both firms and that integration plans continue. "We expect to hit the ground running upon closure," he said. Artema CEO Thomas Axelsson said that a strong market for defibrillator technology "is added incentive to operate as single international entity" and offers "compelling growth opportunities in the emergency care, inpatient and post-discharge market segments." Earlier, Cardiac Science said it expected the transaction to close in June, but that additional time might be required. Artema makes bedside and portable multi-parameter patient monitors and defibrillator devices used in cardiac and emergency care applications inside and outside of hospitals. Cardiac Science also said that it has amended its agreement to acquire Survivalink (Minneapolis, Minnesota), a provider of automated external defibrillators (AEDs), reducing the amount of cash required to close the transaction. Under terms of the original agreement, announced on Feb. 14, Cardiac Science agreed to pay $35.5 million in cash and $35.5 million in restricted common stock to Survivalink shareholders for a total purchase price of $71 million. The amended agreement provides for $10 million in cash, $36 million in restricted common stock, and a nine month note of $26 million, secured by the company's assets, for total consideration of $72 million. The acquisition is expected to close this month and is subject to approval by both Cardiac Science and Survivalink shareholders. "We have received verbal commitments for the reduced cash component of the transaction," Cohen said. "This amendment will result in a smoother and more timely close of the merger." Cardiac Science and Survivalink are collaborating to integrate Cardiac Science's proprietary monitoring and automatic tachyarrhythmia detection technology into Survivalink's AEDs. Cardiac Science's product defibrillation products are targeted to the hospital market. In originally announcing the purchase, Cohen said that acquiring Survivalink was part of his company's strategy to become a leading player in the external defibrillation business and to extend its current position beyond the hospital market.
Edwards Lifesciences (Irvine, California), a maker of medical devices to treat cardiovascular disease, said it would sell its U.S. perfusion unit, which offers blood-related services, to Fresenius Medical Care AG (Bad Homburg, Germany) for about $45 million cash. The sale of the unit, which employs about 800 people, including technicians who perform blood-related procedures such as transfusions, closed at the end of June. "Edwards Lifesciences' strategy is to focus on products and technologies to treat advanced cardiovascular disease," said Michael Mussallem, Edwards' chief executive officer. "With the divestiture in August 2000 of our Bentley line of perfusion products, maintaining a U.S. perfusion services presence is no longer consistent with our strategy or core capabilities." The company plans to take a charge of about $100 million in the second quarter related to the deal, about $75 million of which is directly related to the sale. The deal will cut about $90 million of the company's goodwill and other intangible assets, Edwards said. Edwards, which sold about $30 million in perfusion services in the first quarter of this year, said it is on target to meet its goal of 20% net income growth for 2001.