By Lisa Kerner
Charlotte, N.C., Nov. 11 - Galil Medical Ltd., an Elron Electronic Industries Ltd. group company, entered into a definitive agreement to acquire Endocare, Inc. in a stock-for-stock transaction.
Elron expects to close the transaction in the first quarter of 2009.
Current Endocare stockholders will hold 52% of the post-merger stock, and Galil stockholders will hold the remaining 48%.
Endocare will sell approximately 16.25 million newly issued shares of common stock for $1.00 apiece in a private placement to several current institutional investors of Endocare and Galil following completion of the merger, it was reported in a form 10-Q filed with the Securities and Exchange Commission.
The combined company will have pro forma combined revenues and gross profit in the 12 months ended Sept. 30 of approximately $55.6 million and $39.1 million, respectively, an Elron news release said.
Galil president and chief executive officer Martin J. Emerson will lead the combined company.
Annualized cost savings as a result of the merger of over $10 million are expected by mid-2010.
Elron is a member of the IDB Holding group, an Israel-based technology holding company.
Located in Irvine, Calif., Endocare develops minimally invasive medical devices used for tissue and tumor ablation.
| Acquirer: | Galil Medical Ltd.
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| Target: | Endocare, Inc.
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| Announcement date: | Nov. 11
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| Expected closing: | First quarter of 2009
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| Stock price for acquirer: | Nasdaq: ELRN: $2.35 on Nov. 10
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| Stock price for target: | Nasdaq: ENDO: $0.96 on Nov. 10
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