By IANS
Bangalore : Leading Indian healthcare equipment maker Opto Circuits is acquiring Criticare Systems Inc, the US-based mid-size medical equipment firm, for $70 million (Rs.2.8 billion) in an all-cash deal.
Both the listed firms have informed their respective stock exchanges (BSE and Amex) Monday that they have entered into an agreement, under which Opto Circuits would offer $5.5 per share to Criticare for an aggregate price of $70 million.
The $32-million Criticare designs, manufactures and markets cost-effective patient monitoring systems such as vital sign and anaesthesia monitors and non-invasive sensors like oximeters for hospitals and alternate health care environments the world over.
“The offer price ($5.5) per share represents a premium of 65 percent to the average price of Criticare stock over the preceding three months and a premium of 19 percent to the closing price Feb 22 at $4.62 on Amex,” the US firm said in its disclosure.
In a filing with the Securities Exchange Commission (SEC), Criticare said Opto Circuits’ US-based subsidiary would make an all-cash tender offer for its outstanding shares and then merge with it.
“The acquisition will expand our presence in patient monitoring since Criticare is known for high-quality innovative products and services. The transaction will open global markets for Criticare’s products and enhance our product offering in the US,” Opto Circuits managing director Vinod Ramnani told IANS here.
Post-merger, Criticare will become a wholly owned subsidiary of Opto Circuits, which intends to fund the acquisition through a third party.
“We believe the deal will provide value to our stockholders and accelerate our growth through enhanced market presence, while creating a platform to serve our customers worldwide,” Emil Soika, president and chief executive officer of Criticare said.
The Rs.2.1-billion Opto Circuits’ product portfolio consists digital thermometers, sensors, probes, pulse oximeters, patient monitoring systems, cardiac stents and catheters.
The latest buyout will be Opto Circuits’ second in the US after Pancho in 2002 and third overseas, as Eurocor GmbH of Germany, which designs and manufactures stents, was acquired in 2005 for euro 11 million (Rs.600 million).
Stent is a slender thread, rod or catheter inserted into a tubular structure such as a blood vessel to provide support during or after.