With a $6 billion dollar deal to merge with Cytyc in the wings, Hologic has struck yet another one that will cost much less. But like the Cytyc deal, it will complement Hologic’s existing portfolio of women’s healthcare products.
With a $6 billion dollar deal to merge with Cytyc in the wings, Hologic has struck yet another one that will cost much less. But like the Cytyc deal, it will complement Hologic's existing portfolio of women's healthcare products.
The $70 million transaction, announced after the stock market closed June 21, is for BioLucent's radiolucent foam cushion business. The patented MammoPad, which is designed, manufactured, and sold by privately held BioLucent of Aliso Viejo, CA, fits over the cold, hard surfaces of mammography equipment.
The cushion reduces the discomfort that inhibits many women from getting regular mammography screenings, according to Hologic. Nearly 20% of mammography facilities nationwide offer the cushions as standard of care, and they have been used by more than 10 million women. In 2006, BioLucent achieved revenues of $17 million, a 42% increase over the previous year.
Hologic Chairman and CEO Jack Cumming said the proposed acquisition would provide additional capabilities and customer relationships to further solidify the company's position in the mammography market.
After the deal goes through as anticipated by September, BioLucent will spin off its brachytherapy business into a newly created independent company. First, however, the Hologic acquisition must pass scrutiny during a California fairness hearing and will be subject to customary closing conditions, including stockholder approval.
Payment will be $5 million cash, with the remaining $65 million paid in cash, shares of Hologic common stock, or a combination thereof, as determined by Hologic. The total price might increase due to a two-year earn-out. If certain revenue targets are met, the earn-out will be paid in two annual cash installments not to exceed a total of $15 million.