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news.Endocare and privately held Galil Medical, both medical device companies, have signed a definitive merger agreement. The combined company will be focused on the promotion and development of cryoablation, a minimally invasive method to freeze and destroy cancerous tumors, the two companies have said.
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The terms of the agreement call for a stock-for-stock merger transaction resulting in Galil Medical becoming a wholly-owned subsidiary of Endocare, and would provide current Endocare stockholders 52%, and current Galil stockholders 48%, of the outstanding stock of the combined company.
The new management team will be composed of executives of both companies and will be led by Martin Emerson, Galil Medical’s president and CEO, and Michael Rodriguez, Endocare’s CFO.
Endocare has also announced that upon the closing of the merger it will sell $16.25 million of newly issued shares of its common stock in a private placement, priced at $1 per share, to certain current institutional investors of Endocare and Galil.
The transaction, which is expected to close in the first quarter of 2009, will combine the complementary clinical, technological and marketing strengths of the two companies. The merger and related transactions are expected to create significant clinical and operational advantages for the combined company, allowing it to accelerate technological innovation and promote the growing recognition of cryoablation in the global healthcare marketplace.
Mr Emerson said: “This merger allows the two companies to come together as one to combine the very best in cryoablation technologies, and to jointly demonstrate the clinical and economic advantages cryoablation has over radiation, radical prostatectomy and IMRT in the treatment of prostate cancer as well as in other oncology treatments where cryoablation has application.
“The company will be much stronger financially following the combination and in a much better position to deliver the promise that cryoablation offers to physicians and patients all over the world.”