Angiotech Pharmaceuticals to Acquire American Medical Instruments Holdings, Inc.
01 Februar 2006 - 12:00PM
PR Newswire (US)
Transaction Establishes Commercialization Platform to Capitalize on
Angiotech's Significant Technology and R&D VANCOUVER, British
Columbia, Feb. 1 /PRNewswire-FirstCall/ -- Angiotech
Pharmaceuticals, Inc. (Nasdaq: ANPI; TSX: ANP) today announced that
it has entered into a definitive agreement to acquire privately
held American Medical Instruments Holdings, Inc. (AMI), a leading
independent manufacturer of specialty, single-use medical devices,
for approximately $785 million in cash. The transaction provides
Angiotech with a commercial platform to capitalize on its current
product pipeline, supporting a wide range of specialty therapeutic
areas. At the same time, the acquisition of AMI significantly
diversifies Angiotech's revenue base and gives the company global
manufacturing, marketing and sales capabilities. The transaction,
which is anticipated to close in the second quarter of 2006, is
expected to be immediately accretive to Angiotech's 2006 and 2007
results. AMI has global operations in 12 locations and four
countries, including over 550,000 square feet of modern
manufacturing operations. Post transaction, Angiotech will have two
specialty sales forces operating on a worldwide basis; one focused
primarily on general surgery, plastic surgery, and ophthalmic
surgery, and the second focused on vascular surgery, interventional
radiology and tumor biopsy. Dr. William L. Hunter, President and
Chief Executive Officer of Angiotech, said, "The acquisition of
American Medical Instruments represents a transformational event
for Angiotech. The convergence of Angiotech's exceptional research
and development efforts and AMI's expertise in operations,
manufacturing and sales uniquely positions the combined company to
develop and commercialize the next generation of medical devices
and combination products. At the same time, it will enhance our
ability to capture and accelerate additional revenue opportunities.
This compelling transaction is consistent with our strategy of
creating additional long-term growth drivers that diversify our
business mix and deliver value for our shareholders. We are very
excited about working with AMI's talented employees to achieve
continued growth and long-term success in the marketplace and to
offer physicians and patients the best available products and
treatment opportunities in the industry." Thomas Bailey, Chief
Financial Officer of Angiotech, said, "This exciting and
strategically important acquisition is the culmination of our
efforts to establish a platform to commercialize our product
candidates and R&D initiatives. The addition of AMI is a
cost-effective solution to accelerate our strategy and brings to
Angiotech significant commercial resources in manufacturing
facilities and specialty sales forces. In addition, we are
confident that the combination of Angiotech and AMI will generate
significant cash flow derived from diverse revenue sources. We
anticipate a rapid and smooth integration of our two businesses."
AMI's revenues are estimated to be approximately $174 million for
the year ended December 31, 2005, which represents approximately 46
percent of the estimated combined 2005 revenues of the two
companies. In addition, Angiotech anticipates that the transaction
will be immediately accretive to its 2006 adjusted earnings per
share. For 2007, the first full fiscal year of combined operations,
Angiotech expects meaningful accretion in adjusted earnings per
share, driven by underlying growth in AMI earnings and synergy
realization. Angiotech has secured $600 million in fully committed
term loan facilities to finance the transaction, and expects to
fund the acquisition through a combination of these or other debt
financings, and the contribution of approximately $200 million of
existing cash on hand. Following the transaction, Angiotech's pro
forma balance sheet will remain strong with approximately $160
million remaining cash on hand and manageable levels of debt as
compared to pro forma EBITDA and free cash flow. Strategic and
Financial Benefits of the Transaction -- Acquire Significant
Manufacturing, Marketing and Sales Capabilities. The addition of
AMI's core capabilities - substantial commercial operations,
marketing and sales - will advance Angiotech's objective to capture
more value from its various product opportunities and technologies.
AMI has two dedicated and focused sales organizations for
physician-preferred products. These sales forces could potentially
sell the standalone Lifespan(R) vascular graft products, which
Angiotech recently acquired from Edwards Lifesciences, Angiotech's
Vascular Wrap(TM) paxlitaxel-eluting mesh, drug-loaded surgical
sealant products, drug-eluting central venous catheter (CVC)
(currently in clinical trials), as well as many potentially new
product offerings that would be enabled by the combination of the
companies. In addition, AMI has excess manufacturing capacity to
allow for future growth in existing plant and equipment. --
Substantial Potential New Revenue Opportunities. The company
expects that the combination of its various biomaterials and drug
technologies with AMI's devices will provide for numerous new
product opportunities. Many of these new product iterations have
the potential to be rapidly developed and launched. The combined
company would provide new "value capture" outlets for Angiotech's
R&D initiatives and acquired technologies. -- Strongly Managed
Operation. AMI's management is comprised of highly experienced
executives with deep industry knowledge and operational expertise.
Mike Hudson, AMI's CEO, and Richard Adloff, AMI's CFO, will assist
in the integration of Angiotech and AMI in order to facilitate a
smooth transition. Peter Molinaro, President of the Surgical
Specialties division, Robert Pietrafesa, President of the InterV
division, and Kirk O'Brien, President of the OEM division, will
join Angiotech's management team. Mr. Molinaro has over 20 years of
medical technology operations experience and has built and sold
several highly successful ophthalmic device companies. Also an
industry veteran, Mr. Pietrafesa has extensive executive experience
managing and developing growing businesses with particular
expertise in manufacturing operations, quality control systems and
strategic marketing. Mr. O'Brien also has executive management
experience including overseeing numerous corporate acquisitions and
company integrations. -- Significant Revenue Diversification. For
the year ended December 31, 2005, it is estimated that the combined
company will have total revenues of approximately $375 million.
AMI's revenue base is highly diversified from a product and
customer concentration perspective. A vast catalogue of products
will serve areas such as vascular surgery, interventional
radiology, general surgery, wound closure, ophthalmology and
minimally-invasive cosmetic surgery. The transaction is subject to
customary closing conditions. Following the close of the
transaction, AMI will become a newly created division of Angiotech,
with operations in Illinois, Pennsylvania, New York, Florida,
Denmark and the UK - and will consist of three specific operating
business units: Surgical Specialties, InterV and an OEM division.
"The AMI culture and dedication to improving the quality of lives
for patients are in sync with our own," added Dr. Hunter. "There is
no overlap between our two organizations and our skills and
expertise are the perfect complement to AMI's core strengths. We
have long respected the AMI team and what they have accomplished.
We welcome AMI's employees to Angiotech and look forward to their
active participation in our continued success." Merrill Lynch &
Co. is acting as financial advisor and Sullivan & Cromwell LLP
is acting as legal counsel to Angiotech. Credit Suisse and Merrill
Lynch & Co. have provided the necessary financing commitments
to complete the transaction. Conference Call for Investors and
Analysts Angiotech will host a conference call today, February 1,
2006, at 9:00 AM ET / 8:00 AM CT / 6:00 AM PT, to discuss the
transaction. The call will be webcast on Angiotech's website at
http://www.angiotech.com/ under "Investors." To participate on the
conference call, call toll-free at 866-425-6192 (North America) or
973-935-2981 (International), conference ID 6988920. A recording of
the call will be available until February 8, 2006, by calling
877-519-4471 (North America) or 973-341-3080 (International) and
entering Access Code 6988920. About Angiotech Pharmaceuticals
Angiotech Pharmaceuticals, Inc. is a specialty pharmaceutical
company that discovers and develops innovative treatment solutions
for diseases or complications associated with medical device
implants, surgical interventions and acute injury or trauma. To
find out more about Angiotech Pharmaceuticals, Inc. (Nasdaq: ANPI;
TSX: ANP), please visit our website at http://www.angiotech.com/.
About American Medical Instruments American Medical Instruments
Holdings, Inc. (AMI) is a leading independent manufacturer of a
variety of single-use medical device products for specialty areas
such as vascular surgery, interventional radiology, general
surgery, wound closure, and minimally-invasive cosmetic surgery.
AMI was formed in 2003 following the purchase of a majority
interest in several medical technology companies by RoundTable
Healthcare Partners from The Marmon Group. Forward-Looking
Statements and Historical Financial References This press release
contains forward-looking statements, which provide our current
expectations or forecasts of future events. Forward-looking
statements include, without limitation: - information concerning
expected operational and financial benefits from the proposed
acquisition; - information concerning future operations and plans
for Angiotech and the combined company; - information concerning
possible or assumed future results of operations, trends in
financial results and business plans; - statements about our
product development activities and schedules; - statements about
our potential or prospects for future product sales and royalties;
- statements about our future capital requirements and the
sufficiency of our cash, cash equivalents, investments and other
sources of funds to meet these requirements; - other statements
about our plans, objectives, expectations and intentions; and -
other statements that are not historical fact. Financial results
for the year-ended December 31, 2005 are preliminary and unaudited.
In some cases, you can identify forward-looking statements by words
such as "anticipate," "believe" or "intend," but the absence of
those words does not necessarily mean that a statement is not
forward-looking. Forward-looking statements are subject to known
and unknown risks and uncertainties and are based on potentially
inaccurate assumptions that could cause actual results to differ
materially from those expected or implied by the forward-looking
statements. Our actual results could differ materially from those
anticipated in the forward-looking statements for many reasons,
including the factors described in the section titled "Risk
Factors" in our annual information form for the year ended December
31, 2004 filed with the Securities and Exchange Commission. Other
factors besides those described in our annual information form
could also affect actual results. You should carefully consider the
factors described in the section titled "Risk Factors" in our
annual information form in evaluating our forward-looking
statements. You should not unduly rely on these forward-looking
statements, which speak only as of the date of this press release.
We undertake no obligation to publicly update any forward-looking
statements to reflect circumstances or events after the date of
this press release, or to reflect the occurrence of unanticipated
events. You should, however, review the factors and risks we
describe in the reports we file from time to time with the
applicable Canadian securities commissions or similar regulatory
authorities or the Securities and Exchange Commission. DATASOURCE:
Angiotech Pharmaceuticals, Inc. CONTACT: Analysts and Investors:
Todd Young, +1-604-221-7676 ext. 6933, or Analysts: Rui Avelar,
+1-604-221-7676 ext. 6996, both of Angiotech Pharmaceuticals, Inc.;
or Media: Joele Frank or Steve Frankel both of Joele Frank,
Wilkinson Brimmer Katcher, +1-212-355-4449 Web site:
http://www.angiotech.com/
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