Healthcare Industry News: AngioDynamics
News Release - April 10, 2008
Diomed Holdings Enters into Sale Agreement with AngioDynamicsCritical Step Forward in Reorganization
ANDOVER, Mass.--(HSMN NewsFeed)--Diomed Holdings, Inc., a leading developer and marketer of minimally invasive medical technologies, including its patented EVLT® laser treatment for varicose veins, announced that it has entered into an asset purchase agreement with AngioDynamics, Inc. for the sale of Diomed’s U.S. operations for a cash purchase price of $8 million. The assets subject to the Agreement exclude the proceeds of Diomed’s settlement of its ‘777 patent litigation with AngioDynamics, under which AngioDynamics agreed to pay $7 million, and the proceeds of Diomed’s anticipated $3.6 million settlement with Vascular Solutions, Inc, now pending bankruptcy court approval, as well as certain patents.
On March 14, 2008 Diomed Holdings and its wholly-owned subsidiary, Diomed, Inc. filed a voluntary petition under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Massachusetts, Western Division. Since that time, Diomed has been operating as a debtor-in-possession while pursuing the sale of its U.S. operating assets. Diomed expects to complete the asset sale to AngioDynamics within approximately 60 to 90 days and to sell its remaining assets in due course, subject to the approval of the bankruptcy court.
AngioDynamics has also agreed to pay $3 million in cash for certain of the assets of Diomed Ltd, the UK subsidiary of Diomed Inc, which filed for insolvency Administration under the laws of the United Kingdom contemporaneously with Diomed’s bankruptcy filing in the United States. The closing of AngioDynamics’ agreement with Diomed Holdings is conditioned upon AngioDynamics’ acquisition of Diomed Ltd’s assets and is subject to, among other conditions, court approval and an auction process administered by the courts, under which other interested parties may present competing offers.
The asset purchase agreement contemplates that Diomed will use its existing cash, receivables and ongoing revenues to fund its operations while it operates under Chapter 11, and, if necessary, may include up to $1.3 million in debtor-in-possession financing from AngioDynamics. The contemplated debtor-in-possession financing will also be subject to bankruptcy court approval.
“We believe that AngioDynamics’ acquisition of Diomed’s business provides our loyal physician partners the best opportunity for a continuation of superior customer service, an expanded flow of new and innovative technologies, and continuity of laser and disposable product supply,” stated James A. Wylie, Jr., Diomed’s Chief Executive Officer. “Additionally, Diomed’s EndoVenous Laser business is a terrific fit with AngioDynamics’ venous product line – a win-win for patients and physicians alike.”
Diomed develops and commercializes minimal and micro-invasive medical procedures that use its proprietary laser technologies and disposable products. Diomed’s EVLT® laser vein ablation procedure is used in varicose vein treatments. Diomed also provides photodynamic therapy (PDT) for use in cancer treatments, and dental and general surgical applications. The EVLT® procedure and the Company’s related products were cleared by the United States FDA in January of 2002. Along with lasers and single-use procedure kits for its EVLT® laser vein treatment, the Company provides its customers with state of the art physician training and practice development support. Additional information is available on the Company’s website: www.evlt.com.
EVLT® is a registered trademark of Diomed Inc., Andover, MA.
Safe Harbor statements under the Private Securities Litigation Reform Act of 1995: Statements in this news release looking forward in time involve risks and uncertainties, including the risks associated with trends in the products markets, reliance on third party distributors in various countries outside the United States, reoccurring orders under OEM contracts, market acceptance risks, technical development risks and other risk factors. These statements relate to our future plans, objectives, expectations and intentions. These statements may be identified by the use of words such as "may," "will," "should," "potential," "expects," "anticipates," "intends," "plans," "believes" and similar expressions. These statements are based on our current beliefs, expectations and assumptions and are subject to a number of risks and uncertainties.
Moreover, our bankruptcy filing in the United States and the concurrent administration filing of our manufacturing subsidiary in the United Kingdom raise significant concern as to the reliability going forward of our previous and current forward-looking statements. The bankruptcy process will require court approval of, among other things, the contemplated acquisition of our operating assets by AngioDynamics and debtor-in-possession financing. Further, given recent developments, our actual results are likely to differ materially from those discussed in our previous financial statements. Diomed disclaims any obligation or duty to update or correct any of its forward-looking statements.
Source: Diomed Holdings
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