Bayer HealthCare affiliate MEDRAD Inc, Warrendale, Pa, and Possis Medical Inc, Minneapolis have signed a definitive merger agreement in which MEDRAD will acquire Possis Medical in a cash tender offer for $19.50 a share, or a total equity value of about $361 million.
The offer price represents a premium of some 39% over Possis Medical’s average closing price for the 30 days prior to February 8, 2008. Possis board members unanimously approved the transaction and will recommend the offer to shareholders.
MEDRAD provides contrast injection systems for the diagnosis of cardiovascular and other diseases. Possis Medical provides mechanical thrombectomy devices to treat narrowed or blocked arteries and veins. The merger would help MEDRAD focus on the treatment of patients in the growing cardiovascular intervention field.
The transaction is structured as a tender offer, which the parties plan to commence within the next 10 business days, followed by a merger. The tender offer and the merger are subject to terms and conditions detailed in the merger agreement, including the tender of not less than two-thirds of the outstanding shares of Possis Medical on a fully-diluted basis and customary regulatory clearances.
The tender offer is not subject to a financing contingency. The tender is to be followed by a second-step merger in which any untendered Possis Medical shares would be converted into the right to receive the same price per share as shareholders who tendered in the cash tender offer. The tender offer is expected to close in the first quarter of 2008.