01 Jun Merge to aquire etrials for $1.70/share stock/cash
Milwaukee – Merge Healthcare (“Merge”), a medical imaging and health IT solutions provider, and etrials Worldwide, Inc. (“etrials”), a provider of clinical trials software and services, today announced that they have reached a definitive agreement for the acquisition of etrials by Merge. The combined organization will provide clinical trial sponsors and contract research organizations (“CROs”) comprehensive and configurable solutions that include both critical imaging technologies and eClinical capabilities.
“Our Merge OEM team has been a supplier of imaging solutions to pharmaceutical companies, CROs, the National Institute of Health and to veterinary hospitals for years,” states Justin Dearborn, CEO of Merge Healthcare. “We believe that there could be significant synergy from incorporating our imaging and data hosting solutions with etrials’ broad portfolio of integrated eClinical solutions. etrials’ experience in conducting global clinical trials also complements Merge’s international expansion initiatives.”
Clinical trials are vital to the approval of new pharmaceutical treatments and medical devices, and etrials has developed applications designed to accelerate the process, improve data quality and reduce overall trial costs. Over the past 20 years, etrials has participated in over 900 clinical trials involving more than 400,000 patients in over 70 countries through its electronic data capture (EDC), interactive voice and Web response (IVR/IWR), and electronic patient reported outcomes (ePRO) technology for clinical trial development and data management. At the same time, Merge has spent the past 20 years building software solutions that improve the speed, cost and quality of medical imaging workflow. As clinical trials are becoming more dependent on imaging information, this acquisition allows Merge to capitalize on emerging trends and accelerate both companies’ strategy to consistently deliver increased value to customers in the clinical trial market.
“etrials welcomes this opportunity to become part of Merge Healthcare,” adds M. Denis Connaghan, CEO of etrials. “It continues with our strategy to take the industry in a new direction that is increasingly in demand by bringing our customers access to additional capabilities that we believe increases the value of the important clinical trial development they perform. It also gives the etrials organization a broader base of financial, product and development resources, and international relationships to continue the improvements that have been made and enable an expansion of the business.”
“This acquisition enables both companies to leverage the other’s customer relationships, from pharmaceutical companies, CRO’s, medical device manufacturers and veterinary hospitals; creating cross-sell and up-sell opportunities,” continues Dearborn. “etrials’ offerings have no overlap with Merge’s products. We believe that this acquisition will deliver significant added value to each company’s customers, partners and shareholders.”
The Merge tender offer, which consists of a mix of $0.80 in cash and 0.3448 shares of Merge common stock for each share of etrials common stock, represents an aggregate value of $1.70 per share, calculated using the $2.610, 20-day volume-weighted average price of Merge common stock as of the close of market on May 26, 2009, which was the last trading day before Merge made this offer to etrials. The Merge offer was formally recognized as a Superior Proposal by etrials’ Board of Directors pursuant to the terms of etrials’ previously announced definitive agreement with Bio-Imaging Technologies, Inc. dated as of May 4, 2009, and as amended on May 15 and May 19, 2009. The proposed acquisition by Merge is expected to be consummated through a tender offer for all of the outstanding shares of etrials stock. Stockholders representing approximately 33% of etrials’ outstanding shares have already agreed to tender their shares. Pending customary closing conditions and the successful completion of the tender offer, it is expected that the transaction will close in the third quarter of 2009.
The merger agreement provides for Merge to acquire etrials in a two-step transaction. The first step will consist of a tender offer for all outstanding shares of etrials common stock as described above. In the second step, the tender offer will be followed by a merger in which any untendered outstanding shares of etrials common stock will be converted into the right to receive the same consideration per share offered in the tender offer.
More information on the pending acquisition can be found at www.merge.com/investor or www.investor.etrials.com.