Healthcare Industry News: McKesson
News Release - July 11, 2006
McKesson to Sell Its Acute Care Medical-Surgical Distribution Business to Owens & Minor
Move Will Allow McKesson to Focus on the Growing Alternate Site MarketSAN FRANCISCO--(HSMN NewsFeed)--July 11, 2006--McKesson Corporation (NYSE:MCK ), the world's leading healthcare services company, today announced that it has signed a definitive agreement to sell the acute care division of its medical-surgical supply business to Owens & Minor, Inc. (NYSE:OMI ). The acquisition is expected to close in the fourth calendar quarter of 2006, subject to customary conditions, including regulatory review.
Although it is divesting its hospital supply business, McKesson's Medical-Surgical business unit will continue to serve the growing alternate site market, which includes physician offices, clinics, surgery centers, nursing homes, home care and occupational health facilities.
Under the arrangement, Owens & Minor will acquire all of McKesson's assignable acute care customer contracts, as well as related inventory and fixed assets.
In May, McKesson publicly announced its intentions to seek strategic alternatives for its acute care business. "We considered all of our options and after a careful analysis, determined that our customers, our company and our shareholders would best be served if we sold acute care to an industry leader like Owens & Minor," said John Hammergren, Chairman and CEO of McKesson. "This strategic decision will provide our hospital customers -- many of whom we will continue to serve through our other businesses -- with the high levels of quality and service they've come to expect from McKesson. And, it will allow us to better focus our energies on the rapidly growing alternate site market, where McKesson is already a leading supplier."
"We are excited about the opportunity to further expand our alternate site business, and have already begun to sharpen our focus on this higher growth, higher margin part of the market," said Brian Tyler, president of McKesson Medical-Surgical. "We look forward to building on our industry leadership to provide our alternate site customers with the best service and best value in the industry."
McKesson's Medical-Surgical business delivers a comprehensive offering of healthcare products, equipment and related services spanning the continuum of care from physician offices and surgery centers, to long-term care facilities and home care businesses across the country.
Risk Factors
Except for historical information contained in this press release, matters discussed may constitute "forward-looking statements", within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, that involve risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. These statements may be identified by their use of forward-looking terminology such as "believes", "expects", "anticipates", "may", "should", "seeks", "approximates", "intends", "plans", "estimates" or the negative of these words or other comparable terminology. The most significant of these risks and uncertainties are described in the company's Form 10-K, Form 10-Q and Form 8-K reports filed with the Securities and Exchange Commission and include, but are not limited to: adverse resolution of pending shareholder litigation regarding the 1999 restatement of our historical financial statements; the changing U.S. healthcare environment, including changes in government regulations and the impact of potential future mandated benefits; competition; changes in private and governmental reimbursement or in the delivery systems for healthcare products and services; governmental and manufacturers' efforts to regulate or control the pharmaceutical supply chain; changes in pharmaceutical and medical-surgical manufacturers' pricing, selling, inventory, distribution or supply policies or practices; changes in the availability or pricing of generic drugs; changes in customer mix; substantial defaults in payment or a material reduction in purchases by large customers; challenges in integrating and implementing the company's internally used or externally sold software and software systems, or the slowing or deferral of demand or extension of the sales cycle for external software products; continued access to third-party licenses for software and the patent positions of the company's proprietary software; the company's ability to meet performance requirements in its disease management programs; the adequacy of insurance to cover liability or loss claims; new or revised tax legislation; foreign currency fluctuations or disruptions to foreign operations; the company's ability to successfully identify, consummate and integrate strategic acquisitions; changes in generally accepted accounting principles (GAAP) and general economic conditions. The reader should not place undue reliance on forward-looking statements, which speak only as of the date they are made. The company assumes no obligation to update or revise any such statements, whether as a result of new information or otherwise.
About Owens & Minor
Owens & Minor, Inc. (NYSE: OMI ), a FORTUNE 500 company headquartered in Richmond, Virginia, is the leading distributor of national name-brand medical and surgical supplies and a healthcare supply chain management company. With a diverse product and service offering and distribution centers throughout the United States, the company serves hospitals, integrated healthcare systems, alternate care locations, group purchasing organizations, the federal government and consumers. Owens & Minor provides technology and consulting programs that enable healthcare providers to maximize efficiency and cost-effectiveness in materials purchasing, improve inventory management and streamline logistics across the entire medical supply chain -- from origin of product to patient bedside. The company also has established itself as a leader in the development and use of technology. For news releases, or for more information about Owens & Minor, visit the company Web site at www.owens-minor.com.
About McKesson
McKesson Corporation (NYSE:MCK ), currently ranked 16th on the FORTUNE 500, is a healthcare services and information technology company dedicated to helping its customers deliver high-quality healthcare by reducing costs, streamlining processes and improving the quality and safety of patient care. Over the course of its 173-year history, McKesson has grown by providing pharmaceutical and medical-surgical supply management across the spectrum of care; healthcare information technology for hospitals, physicians, homecare and payors; hospital and retail pharmacy automation; and services for manufacturers and payors designed to improve outcomes for patients. For more information, visit us at www.McKesson.com.
Source: McKesson
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