Prism Medical Ltd., a provider of durable medical equipment and related services to the mobility disadvantaged, announced an agreement to buy the manufacturing assets of Burnsville, Minn.-based MedCare Products Inc. As part of the same transaction, Mississauga-based Prism will for 10 years be an exclusive supplier to MedCare’s on-going business. Since 2004, Prism has been backed by private equity investor Yellow Point Equity Partners.
Prism Medical Announces Transaction with MedCare Products Inc. – Significantly increases product line and U.S. customer base –
TORONTO, Dec. 10, 2012 /CNW/ – Prism Medical Ltd., (“Prism Medical” or “the Company”) (TSXV: PM), a leading provider of durable medical equipment and related services to the mobility challenged, today announced that it has acquired the manufacturing assets of Medcare Products Inc. (MedCare). As part of the transaction, Prism has entered into a 10-year agreement to exclusively supply all products Medcare sells in the moving and handling industry. All amounts are in U.S. dollars.
Medcare is a manufacturer and supplier of floor lifts, ceiling lifts, car extractors, slings and transfer aids for the U.S. market. Medcare’s operations are based out of Burnsville, Minnesota, U.S., outside of Minneapolis-St. Paul. Medcare sells these products to the long-term care industry throughout the United States and to a growing list of acute care facilities in the U.S.
“This is an important transaction for us as it meets a number of key strategic objectives and builds shareholder value,” said Stuart Meldrum, CEO of Prism Medical. “Prism’s product offering will expand with the acquisition of the Medcare product ranges, which we hope to market in other world geographies. In addition, we will be able to leverage Medcare’s strong base of dealer business in the long-term care sector and continue to build our hospital group customer base in new geographies with the inclusion of several world-renowned hospital groups.”
The manufacturing assets, which are composed of tools, dies, patents, trademarks, production processes, designs, approximately $2 million of inventory and the supply contract were purchased for $10 million in cash, with a holdback of $1.25 million pending Medcare meeting specified conditions related to the acquired inventory and other matters.
Prism has also invested $450,000 to acquire 49% of Medcare which remains a sales and service company focused on expanding its customer base in the U.S. long term and acute care markets.
About MedCare Products Inc.
Medcare Products Inc. provides patient lift equipment made to prevent caregivers and patients from sustaining injuries during the process of moving and transferring. The Company has a complete product offering of floor lifts, ceiling lifts, car extractors, slings and transfer aids. Medcare designs and manufactures all of its products in the U.S., giving the Company the advantage of being able to offer 24-hour parts response as well as localized service, support and training to its customer base. In 2011, Medcare Products was named to the Fastest 50 List as the 10th fastest growing company in Minnesota by the Minneapolis-St. Paul Business Journal.
About Prism Medical Ltd.
Prism Medical Ltd. is one of the largest providers and manufacturers of durable medical equipment and related services to the mobility challenged in Canada, the US and the UK, with more than 100,000 installations and 200,000 product solutions sold. The Prism Medical brands include Waverley Glen and ErgoSafe, North America’s leading supplier of lifting, handling and repositioning aid products and services across Canada and the US Freeway and Prism Service & Repair are leading suppliers of moving and handling products and services in the UK. For further information visit Prism Medical’s website at www.prismmedicalltd.com or www.sedar.com.
This document contains forward‐looking statements relating to our operations and to the environment in which we operate and our strategy, action plans and investments, which may involve estimates, forecasts and projections. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict and/or are beyond our control. A number of important factors could cause actual outcomes and results to differ materially from those expressed in these forward‐looking statements. These factors include those set forth in this report and our other public filings. Consequently, readers should not place any undue reliance on such forward‐looking statements. These forward‐looking statements are made as of the date of this report. Prism Medical is under no obligation to update any forward‐looking statements contained herein should material facts change due to new information, future events or other factors. All forward‐looking statements attributable to Prism Medical are expressly qualified by these cautionary statements.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
SOURCE: Prism Medical Ltd.
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Chief Financial Officer
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