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CryoLife to acquire Texas company in $130 million deal

Wednesday, December 23, 2015   (0 Comments)
Posted by: Angela King
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Atlanta-based CryoLife Inc. (NYSE: CRY) has entered into an agreement to acquire On-X Life Technologies Holdings, Inc., an Austin, Texas-based, privately held mechanical heart valve company.

CryoLife is a leading medical device and tissue processing company focused on cardiac and vascular surgery.

"We believe this will be a transformative acquisition for CryoLife that will significantly enhance the size of our addressable market and growth potential,” J. Patrick Mackin, chairman, president, and chief executive officer of CryoLife, said in a prepared statement. “This transaction will provide CryoLife access to the $220 million mechanical valve market with a highly advanced portfolio of products.”

Mackin added that On-X valves have been implanted in over 200,000 patients, and On-X has achieved a 13 perent revenue CAGR over the past four years with modest sales and marketing support.

Under the terms of the agreement, CryoLife will acquire On-X for an upfront payment of $130 million on a cash-free, debt-free basis (subject to certain adjustments), consisting of approximately 70 percent in cash and 30 percent in CryoLife common stock.

CryoLife said it expects to finance the cash portion of the transaction primarily with proceeds from the issuance of a new credit facility and available cash. The company said it has received a commitment from Capital One, Fifth Third Bank, and Citizens Bank for a 5-year, $95 million senior secured facility, which includes a $75 million term loan and a $20 million revolving credit facility.

The merger agreement has been approved by both companies' boards of directors and On-X's stockholders, and the transaction is expected to close in January 2016, subject to customary closing conditions.

Source. Atlanta Business Chronicle. http://www.bizjournals.com/atlanta/morning_call/2015/12/cryolife-to-acquire-texas-company-in-130-million.html


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