Merge eFilm and Cedara Software Corp to Merge COMBINATION CREATES
MEDICAL IMAGING MARKET LEADER OFFERING EXPANDED PRODUCTS AND
SERVICES AND ACCELERATED INNOVATION IN THE DIRECT AND OEM CHANNELS
MILWAUKEE, WI, and TORONTO, ON, Jan. 18 /PRNewswire-FirstCall/ --
Merge Technologies Incorporated (NASDAQ:MRGE), d.b.a. Merge eFilm,
a leading global healthcare software and services company, and
Cedara Software Corp. (NASDAQ:CDSW/TSX:NASDAQ:CDE), a leading
independent developer of medical software technologies for the
global healthcare market, today announced a definitive agreement to
merge in an all-stock transaction. Upon completion of the
transaction, the combined company will bring one of the most
comprehensive image and information management solution sets to
manage clinical and business workflow to the diagnostic OEM and end
user markets. The combined company will have an extensive imaging
product suite to meet the current and emerging needs of OEM and end
user customers, radiology and clinical specialties, and an annual
revenue run rate exceeding $100 million (C$122 million). In
addition, the merged company will have an international presence
capitalizing on the digitization of healthcare, and the financial
strength, growth trajectory and product and distribution market
coverage to drive its continued track record as one of the fastest
growing healthcare information technology companies in the market.
Merge eFilm will issue either 0.587 Merge eFilm common shares, or
0.587 shares of a newly created class of Canadian exchangeable
shares for each Cedara common share. Based on the 20-day volume
weighted average price of Merge eFilm stock for the period ending
January 14, 2005, the transaction is valued at US$12.37
(approximately C$15.10) for each common share of Cedara,
representing a 17.5% premium to Cedara's 20-day volume weighted
average price. The merger may permit Canadian shareholders of
Cedara to defer any gain on their shares for Canadian income tax
purposes. The transaction is subject to approval by shareholders of
each company, regulatory approvals and other customary closing
conditions. "I'm very pleased to announce that Merge eFilm and
Cedara are joining together to lead the market with the product and
service depth, financial strength, product innovation resources and
market coverage to deliver value to our key stakeholders:
customers, employees and shareholders," said Richard Linden,
President and CEO of Merge eFilm. "Our combined strengths will
allow us to accelerate the development and deployment of new
imaging products and services for both the OEM markets and our
expanding interest in RIS/PACS offerings beyond radiology.
Together, we create a powerful combination of industry leading
product innovation, sales and marketing distribution, valued
professional services, strengthened international market coverage,
and enhanced access to new markets. For example, we are well
positioned to leverage the market leading innovation of OEM
technologies for clinical specialties such as orthopedics,
cardiology, gastroenterology, and mammography into full workflow
solutions. The scale and momentum from this merger is a proactive
strategy to lead the industry consolidation effort, to further the
steady change in the definition of RIS/PACS and alter the
competitive landscape. Our combined brand is strong, our value
propositions unique, our recent histories indicative of our ability
to succeed financially and we are well positioned to achieve our
growth objectives. This powerful combination of factors will
contribute to the digital evolution of one of the fastest growing
sectors in healthcare information technology, and we are pleased to
be a catalyst for market change with this merger." "Our merged
organization will make it easier to introduce innovative medical
solutions for both our global OEM partners and end user customers,"
said Abe Schwartz, Cedara's President and CEO. "We will be the only
company in our industry with this breadth of end-user and OEM
offerings, with a new depth of clinical and technical expertise to
support them. Our significant expansion of leadership, talent and
operational resources will allow us to enter new clinical markets
and create product offerings beyond radiology. Our employees will
have greater professional growth and career path development, and
our shareholders will gain from the financial strength of the
combined organization. This is a win-win for all stakeholders." The
corporate headquarters for the newly combined company will be in
Milwaukee, WI. Richard Linden will serve as its President and CEO,
and Abe Schwartz will continue his involvement with the company
including serving as a member of its Board of Directors. Leadership
and integration planning for the combined company is underway and
will be implemented after the anticipated April closing. Based on
the strong growth and financial performance of Merge eFilm and
Cedara, the transaction is expected to be accretive to Merge
eFilm's earnings per share in 2005 (excluding the impact of
one-time transaction-related expenses), and beyond. The combined
company expects to realize operational synergies including time to
market for new imaging products, cross-selling opportunities within
our combined end user customer base, and cost savings associated
with public company activities. William Blair and Company, L.L.C.
acted as financial advisor to Merge eFilm, and Michael Best &
Friedrich LLP and Blake, Cassels & Graydon acted as legal
advisors. Genuity Capital Markets acted as financial advisor to
Cedara and Stikeman Elliott LLP and Debevoise & Plimpton LLP
acted as legal advisors. Merge eFilm and Cedara will host a
conference call to discuss the transaction today, January 18, at
10:00 am CST. To listen to the live broadcast, please see options
listed below: LIVE VIA PHONE: Call: - 800-221-2015 (US &
Canada) - 706-634-2159 (International) Reference Conference ID No.:
3499352 LIVE VIA WEBCAST: Go To:
http://phx.corporate-ir.net/playerlink.zhtml?c=85928&s=wm&e=1002693
For additional information about the conference call, visit:
http://www.merge.com/investor/confcalllist.asp (Editors Note: see
the following fact sheets for additional details concerning Merge
eFilm and Cedara). MERGE EFILM - CEDARA MERGER DEAL FACT SHEET
Parties Merge eFilm Cedara Software Exchange NASDAQ: MRGE TSX: CDE;
NASDAQ: CDSW Symbol: Company Merge eFilm is a global Cedara
Software Corp. is a Description healthcare software and leading
independent provider services company focused of medical imaging on
accelerating the technologies. Cedara software productivity of
imaging is deployed in hospitals and centers, small- to medium-
clinics worldwide and is sized hospitals and licensed by many of
the clinics with a suite of world's leading medical RIS/PACS
products that device and healthcare more efficiently information
technology streamline, integrate and companies. Approximately
distribute image and 28,000 medical imaging information workflow
systems and 6,400 Picture across the healthcare Archiving and
Communications enterprise. Since 1987, System (PACS) workstations
Merge eFilm has leveraged have been licensed to date. its
healthcare integration Cedara recently acquired eMed and
connectivity experience Technologies Corporation, to create
workflow widely known as a solutions that improve our provider of
innovative PACS customers' productivity and and teleradiology
solutions enhance the quality of care that have been installed in
they provide. over 2,000 hospitals and imaging centers.
Headquarters 1126 South 70th Street 6509 Airport Road Milwaukee, WI
53214 Mississauga, Ontario L4V 1S7 Tel: (414) 977-4000 Tel: (905)
672-2100 CEO Richard Linden Abe Schwartz CFO Scott Veech Brian
Pedlar Fiscal year 12/04 06/05 ends Market $257.4 million $360.8
million Capitalization (C$439.3 million) No. of Shares 13.2 million
31.8 million No. of 200 350 Employees RIS/PACS 200+ 400+ End User
Customers OEM/VAR 100+ 150+ Customers Website
http://www.merge-efilm.com/ http://www.cedara.com/ Financial
William Blair & Genuity Capital Markets Advisors: Company,
L.L.C. Legal Michael Best & Friedrich Stikeman Elliott LLP and
Advisors: and Blake, Cassels & Debevoise & Plimpton LLP
Graydon Transaction Fixed exchange ratio: 0.587 Merge eFilm common
or summary exchangeable shares for each Cedara share Structure:
Plan of Arrangement with exchangeable shares Approvals: Subject to
shareholder and regulatory approval Expected close: Early 2Q 2005
About Merge eFilm Merge eFilm is a global healthcare software and
services company focused on accelerating the productivity of
imaging centers, small- to medium-sized hospitals and clinics with
a suite of RIS/PACS products that more efficiently streamline,
integrate and distribute image and information workflow across the
healthcare enterprise. Since 1987, Merge eFilm has leveraged its
healthcare integration and connectivity experience to create
workflow solutions that improve our customers' productivity and
enhance the quality of care they provide. For more information
about Merge eFilm's products and services, visit our website at
http://www.merge-efilm.com/, or call Beth Frost-Johnson, Senior
Vice President-Marketing and Strategic Planning, at 414-977-4254,
email . About Cedara Software Corp Cedara Software Corp. is a
leading independent provider of medical imaging technologies.
Cedara's software is deployed in hospitals and clinics worldwide
and is licensed by many of the world's leading medical device and
healthcare information technology companies. Approximately 28,000
medical imaging systems and 6,400 Picture Archiving and
Communications System (PACS) workstations have been licensed to
date. Cedara recently acquired eMed Technologies Corporation,
widely known as a provider of innovative PACS and teleradiology
solutions that have been installed in over 2,000 hospitals and
imaging centers. Cedara is quite unique in that it has technologies
and expertise that span all the major digital imaging modalities
including computed tomography (CT), magnetic resonance imaging
(MRI), digital X-ray, mammography, ultrasound, echo-cardiology,
angiography, nuclear medicine, positron emission tomography (PET)
and fluoroscopy. Furthermore, the Company's medical imaging
offerings are used in all aspects of clinical workflow including
the capture of a patient's digital image; the archiving,
communication and manipulation of digital images; sophisticated
clinical applications to analyze digital images; and even the use
of imaging in minimally-invasive surgery. For more information
about Cedara's products and services, visit our website at
http://www.cedara.com/, or call Jacques Cornet, Vice President of
Marketing & Operations, at (905) 672-2100 ext. 2564, email: .
Notice to Investors, Prospective Investors and the Investment
Community Cautionary Information Regarding Forward-Looking
Statements Statements in this press release regarding the proposed
merger of Merge Technologies, (d.b.a. Merge eFilm) and Cedara
Software Corp. which are not historical facts, including
expectations of financial results for the combined companies (e.g.,
projections regarding revenue, earnings, cash flow, cost savings
and future growth), are "forward-looking statements." All
forward-looking statements are inherently uncertain as they are
based on various expectations and assumptions concerning future
events and they are subject to numerous known and unknown risks and
uncertainties which could cause actual events or results to differ
materially from those projected. Investors are cautioned not to
place undue reliance on these forward-looking statements and any
such forward-looking statements are qualified in their entirety by
reference to the following cautionary statements. Merge eFilm and
Cedara undertake no obligation to publicly release the result of
any revisions to these forward-looking statements that may be made
to reflect any future events or circumstances. Important factors
upon which the forward-looking statements presented in this release
are premised include: (a) receipt of regulatory and shareholder
approvals without unexpected delays or conditions; (b) timely
implementation and execution of merger integration plans; (c) the
ability to implement comprehensive plans for asset rationalization;
(d) the successful integration of the IT systems and elimination of
duplicative overhead and IT costs without unexpected costs or
delays; (e) retention of customers and critical employees; (f)
successfully leveraging Merge eFilm/Cedara's comprehensive product
offering to the combined customer base; (g) continued growth at
rates approximating recent levels for imaging information systems
and other product markets; (h) no unanticipated changes in laws,
regulations, regulatory requirements or other industry standards
affecting Merge eFilm/Cedara's businesses which require significant
product redevelopment efforts, reduce the market for or value of
its products or render products obsolete; (i) no unanticipated
developments relating to previously disclosed lawsuits or similar
matters; (j) successful management of any impact from slowing
economic conditions or consumer spending; (k) no catastrophic
events that could impact Merge eFilm/Cedara's or its major
customer's operating facilities, communication systems and
technology or that has a material negative impact on current
economic conditions or levels of consumer spending; (l) no material
breach of security of any Merge eFilm/Cedara's systems; and (m)
successfully managing the potential both for patent protection and
patent liability in the context of rapidly developing legal
framework for expansive software patent protection. In addition,
the ability of Merge eFilm/Cedara to achieve the expected revenues,
accretion and synergy savings also will be affected by the effects
of competition (in particular the response to the proposed
transaction in the marketplace), the effects of general economic
and other factors beyond the control of Merge eFilm/Cedara, and
other risks and uncertainties described from time to time in Merge
eFilm/Cedara's public filings with United States Securities and
Exchange Commission and Canadian securities regulatory authorities.
Additional Information Shareholders are urged to read the joint
proxy statement/management information circular regarding the
proposed transaction when it becomes available, because it will
contain important information. Shareholders will be able to obtain
a free copy of the joint proxy statement/management information
circular, as well as other filings containing information about
Merge eFilm and Cedara, without charge, at the Securities and
Exchange Commission's internet site (http://www.sec.gov/). Copies
of the joint proxy statement/ management information circular and
the filings with the Securities and Exchange Commission that will
be incorporated by reference in the joint proxy
statement/management information circular can also be obtained,
without charge, by directing a request to Merge eFilm's Investor
Relations Department at Merge eFilm's principal executive offices
located at 1126 South 70th Street, Suite S107B, Milwaukee,
Wisconsin 53214-3151; telephone number (414) 977-4000. The
respective directors and executive officers of Merge eFilm and
Cedara may be deemed to be participants in the solicitation of
proxies in respect of the proposed transaction. Information
regarding Merge eFilm's directors and executive officers is
available in Merge eFilm's proxy statement for its 2004 annual
meeting of stockholders, which was filed with the Securities and
Exchange Commission on April 12, 2004, and information regarding
Cedara's directors and executive officers is available in Cedara's
notice of annual meeting and proxy circular for its 2004 annual
meeting, which was filed with the Securities and Exchange
Commission on September 24, 2004. Additional information regarding
the interests of potential participants in the proxy solicitation
will be contained in the joint proxy statement/ management
information circular to be filed with the Securities and Exchange
Commission when it becomes available. DATASOURCE: Cedara Software
Corp.; Merge Technologies Incorporated CONTACT: Merge eFilm,
Richard Linden, President & CEO, (414) 977-4665; Scott Veech,
Chief Financial Officer, (414) 977-4264; Cedara Software Corp., Abe
Schwartz, President & CEO, (905) 672-2101 x2000; Brian Pedlar,
Chief Financial Officer, (905) 672-2101 x2015; To request a free
copy of this organization's annual report, please go to
http://www.newswire.ca/ and click on reports@cnw.
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