Advanced Medical buying IVAC Medical .
SAN DIEGO 1996-08-26
Advanced Medical Inc. said Monday it will buy IVAC Medical Systems Inc. , a former Eli Lilly & Co .
unit , for about $ 400 million in cash , creating one of the world 's largest makers of intravenous infusion therapy products .
Under the agreement , IVAC and Advanced Medical 's wholly owned subsidiary , IMED Corp. , will merge to form a new company that will develop and manufacture infusion pumps that regulate the amount of intravenous fluid being administered to a patient , as well as proprietary disposable products .
The combined company will have estimated revenues of $ 353 million .
Advanced Medical , through IMED , is already one of the nation 's largest developers and manufacturers of intravenous infusion pumps and proprietary disposable products .
It has sales in 38 foreign countries .
San Diego-based IVAC is a major provider of infusion systems and related technologies to the health-care industry .
It has manufacturing plants in San Diego ; Creedmoor , N.C. ; Hampshire , England ; and Tijuana , Mexico , and distributes its prodcuts in more than 120 countries .
Eli Lilly sold IVAC on Dec. 31 , 1994 to DLJ Merchant Banking Partners LP , River Medical Inc. and other investors .
Advanced Medical said it expects to take an unspecified one-time charge to pay for the merger .
It did not say when the charge would be taken .
" The addition of IVAC is expected to contribute to financial results in the full second quarter of 1997 , " the companies said .
The merger will add to both companies ' historical leadership in infusion therapy and technology-based drug delivery devices , they said .
In 1968 , IVAC introduced the world 's first infusion therapy monitoring device .
A year later IVAC improved its system with the addition of an IV pump that regulated the flow of liquids through positive pressure .
IMED introduced the world 's first volumetric infusion pump in 1974 .
IMED had profits of $ 1.7 million , or 6 cents per fully diluted common share , on $ 53.9 million in revenues in the first half of 1996 .
Excluding the effect of a one-time restructuring charge of $ 17.4 million , IVAC had net income of $ 4.2 million on net sales of $ 112.8 million for the 1996 first half .
Advanced Medical reported profits of $ 8.4 million on sales of $ 29.2 million in the quarter ended June 30 .
William J. Mercer , IVAC president and chief executive officer , will become the president and CEO of Advanced Medical .
He led the transition of IVAC to a privately held company and was previously senior vice president at Mallinckrodt Group Inc .
Joseph Kuhn , Advanced Medical and IMED president , will become the new company 's executive vice president and chief financial officer .
The deal is expected to close by the first quarter of 1997 , subject to regulatory approval .
It has already been approved by both companies ' boards .