Companies in the News

Amedisys secures new credit line

Amedisys (Baton Rouge, LA), through an arrangement with National Century Financial Enterprises (Dublin, OH) has secured a $25 million asset-based line of credit and a $3 million, 3-year term loan. National Credit provides medical accounts receivable financing, medical equipment leasing, and loans. Amedisys also announced it has acquired 67% of Tanglewood Surgery Center, a multispecialty outpatient surgery center in Odessa, TX, and sold its durable medical equipment division. "The sale of our DME division is the final step in our restructuring plan," said William Borne, chairman/CEO. Our management team is now entirely focused on home health care, infusion therapy, and ambulatory surgery centers. We believe the company is strategically poised for future growth."

ComTech’s board grows

ComTech Consolidation Group (Houston) has expanded its board of directors from three to six people, with four new directors to be added. Newly appointed members include William Dickerson, Lloyd Broussard, Winifred Fields, and Jim Thuney, who will serve along with existing directors Richard Behlmann and Joel Flowers. All newly appointed directors are managing directors of ComTech operating divisions. Thuney was named interim CEO/chairman to replace company founder Roger Stewart, who died recently.

"Our immediate mission is to further organize and complete an exempt initial public financing for each of the three divisions as stand alone spin-off entities: The Home Health, Mental Health and Technical divisions, each with funding to further expand into their most lucrative business opportunity currently available to their respective business," Thuney said. "As planned, ComTech will remain as majority shareholder in each respective spin-off entity, with the underlying value of its stock based on the public market value of its holdings in each of the three spin-off entities. When the spin-offs are completed, ComTech plans to declare a stock dividend to its shareholders of the stock it retains in the spin-off entities."

HealthCor closes loan

HealthCor Holdings (Dallas) has closed a $6 million working capital loan. The funds net of transaction costs will be used for working capital purposes. Terms call for monthly payment of interest at the rate of 11% per annum and full repayment of the facility by Dec. 31, 1999. If the full $6 million is not repaid by the due date, the loan will convert into common equity shares in sufficient number to represent 19.99% of primary shares outstanding. The transaction represents the first step of a planned recapitalization announced by the company on Dec. 15. HealthCor provides home health care services in the southwestern and central United States.

Stock deal struck

An agreement between In Home Health (Minnetonka, MN) and ManorCare Health Services (Toledo, OH) to modify the terms of the 200,000 shares of In Home Health’s convertible preferred stock held by ManorCare. Under the terms of the modification agreement, ManorCare irrevocably waives the voting rights of the preferred stock, except with respect to any proposal presented to In Home Health’s stockholders that involve liquidating the company, merging or consolidating exchange agreements with another corporation, or amending the company’s articles of incorporation. ManorCare continues to maintain a 41% interest in In Home Health’s common shares outstanding in addition to the preferred shares held. Wolfgang von Maack, chairman of the board, said he expects the modification to improve the company’s ability to act on decisions in terms of independence and timeliness. In Home Health has annual revenues of $97 million.

Matria to buy Gainor

Matria (Marietta, GA) signed a definitive agreement to acquire the business assets of Gainor Medical Manage ment (McDonough, GA). Matria officials said Gainor’s global position in the diabetes disease management market will complement Matria’s disease management infrastructure and broaden the scope of Matria’s diabetes business internationally through expanded services, a larger patient base, and enhanced relationships with self-insured companies, managed care organizations, and key diagnostic companies.

Matria expects the purchase price to be about $130 million, and the transaction will be accounted for under the purchase method of accounting. The financial consideration will be composed of about $85 million in cash at closing, and $45 million in preferred stock, some of which is convertible and includes warrants. The acquisition is expected to be completed by mid-January. Matria’s board of directors will then be expanded to nine seats with the addition of Mark Gainor, CEO of Gainor Medical, and Rod Dammeyer, managing director of Equity Group Corporate Investments, a privately held investment firm controlled by Sam Zells. Bowles Hollowell Conner & Co., a division of First Union Capital Markets, was financial advisor to Matria during the transaction.

MiniMed, FDA set date

MiniMed (Sylmar, CA) officials say the Food and Drug Administration (FDA) has set Feb. 26 as the date for an FDA advisory panel to consider, make recommendations, and vote on a premarket approval application (PMA) for a system designed to provide continuous glucose monitoring for people with diabetes. MiniMed has developed a minimally invasive continuous glucose monitoring system that provides continuous readings of interstitial glucose levels. MiniMed’s continuous sensor is designed to be inserted into the subcutaneous tissue, usually in the abdominal area, using a soft cannula type device. The company wants to introduce a series of products using the system, the first of which is a physician monitor to be used as a diagnostic tool in treating patients with diabetes, much like a cardiac holter-style device.

Also, in an interview with The Wall Street Transcript, MiniMed’s chairman/president/CEO, Alfred Mann, des cribed the PMA system: "For people with diabetes that are on intensive management, at least four – or even more – five or six measurements are made per day. And even this is not nearly enough. There are people who measure as many as 16 times a day! Today, each measurement requires a person to stick a needle into a finger to draw a drop of blood, which is put on a chemically treated strip. That process is not pleasant and deters compliance."

NHMC makes two appointments

National Healthcare Manufacturing Corp. (Winnipeg, Manitoba) appointed Brian Allison as company CFO and promoted Kurt Tarter to vice president of United States sales. The company also posted its results for the six-month period ended Oct. 31, which saw revenues at $5.8 million, a 39% increase from the $4.2 million posted for the similar period the previous year. Gross profits for the first six months of 1998 were $2.4 million, up from the $2 million posted by the company in the first six months of 1997.

New York Health Care buying back stock

New York Health Care (New York) has bought about 50,000 shares of its common stock. On Dec. 31, 1997, company officials announced that the board of directors had authorized a program to repurchase up to $200,000 worth of New York Health Care common stock from time to time in open market transactions. The company has about $130,000 remaining under this program and expects to buy additional shares in the open market if current price levels remain constant. "We continue to believe that New York Health Care common shares represent good values at current price levels and do not reflect the company’s strong year to date financial performance," said the company’s president/CEO, Jerry Braun. "Our latest third quarter financial results were highlighted by a 138% increase in net income on a 47% revenue gain. For the first nine months, the company’s revenue, net income, and EPS have significantly exceeded 1997 results. Moreover, we have yet to realize any revenue associated from our estimated $11 million contract with the city of New York, which is due to begin in January 1999."