Invacare’s offer for Scandinavian Mobility 98% complete
Invacare’s offer for Scandinavian Mobility 98% complete
By MEREDITH BONNER
HHBR Editor
Invacare’s (Elyria, OH) $16.52-per-share cash tender offer for Scandinavian Mobility International (SMI), representing a 109% premium over SMI’s FY98 close, is 98% complete, Invacare said last week. And a redemption offer period has begun to acquire the remaining 1.9% of the shares, Invacare announced late last month.
The acquisition of SMI for $146 million in cash, Invacare said, gives it the "number-one market share in Europe." SMI offers a range of home care products, including beds, mobility aids, and wheelchairs. The company generates annual sales of $130 million.
While Invacare offers many home care products within the same categories as SMI, including home care beds, patient aids, and wheelchairs, and there is some overlap with SMI, Invacare maintains that the SMI offerings are highly complementary, given the differences in SMI’s geographic market strengths. In Europe, Invacare’s strength is primarily in France, Germany, and the United Kingdom, while SMI is stronger in the Scandinavian coutries, Invacare said.
The company plans to merge the two entities’ marketing organizations, consisting of both direct representatives and distributors.
Invacare made its first bid for SMI in June, when it offered $14.58 per share for the company. The total value of the acquisition at that time was $131.3 million. The offer was open until Aug. 11 to shareholders of SMI. Invacare raised its offer from $14.58 per share to $15.09 per share, then, in early August, to $16.52 per share, bringing the total value of the acquisition to $146 million.
Invacare called its 2Q99 sales of $202.2 million "basically flat" and said it was due in part to sluggish domestic sales and Medicare cutbacks. The company’s earnings rose 8% to $11.9 million.
SMI saw sales of $50.4 million for the first six months of FY99 and operating earnings of $4.6 million.
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