Bayer HealthCare affiliate Medrad, Inc., Warrendale, PA and Possis Medical, Inc., today said that it had entered in to a deal to acquire Possis Medical in a $361-million all cash deal. Possis posted revenues of $67 million in its fiscal year ending July 31, 2007.
The $19.50 per share offer represents a premium of approximately 39 per cent over Possis Medical's average closing price for the 30 days prior to 8 February 2008. The board of directors of Possis Medical has unanimously approved the transaction and resolved to recommend it to their shareholders.
The tender offer is not subject to a financing contingency, but subject to a minimum tender of not less than two-thirds of the outstanding shares of Possis Medical on a fully-diluted basis and customary regulatory clearances.
Debt-free and profitable, Possis is a top provider of mechanical thrombectomy devices used to treat narrowed or blocked arteries and veins. Medrad focuses on contrast injection systems to diagnose cardiovascular and other diseases.
Medard said in a statement, "The combination of the two highly compatible sales organisations and shared target customer groups establishes a leading and expansive footprint in the cardiovascular intervention field and empowers the combined organisation to offer a broader, more comprehensive suite of products and an exceptional level of service to its customers."
Analysts say the businesses of Possis and Medrad are highly complementary as Possis manufactures devices to treat blood clots, while Medrad's technology focuses on detecting coronary diseases. The say a merger would capitalize on both companies' strengths and create a strong cardiovascular portfolio as both sell to the same set of customers.
Moreover, Possis will be able to reach a largely untapped global market through Medrad's global distribution network.
Cardiovascular disease remains one of the main causes of death and disability in the United States and Europe and it is estimated that in the US alone, some form of cardiovascular disease affects more than 80 million people.
"Our shared history of innovation bodes well for product development beyond our core businesses, and provides tremendous opportunity for growth for our business and employees," said Possis Medical president and CEO Robert G. Dutcher. "In addition, MEDRAD will enable us to broaden our geographic reach without adding infrastructure. We look forward to joining the Bayer and MEDRAD organisation," said.