Replidyne and Cardiovascular Systems Sign Merger Agreement
04 Novembro 2008 - 9:00AM
PR Newswire (US)
Merger to create NASDAQ-listed medical device company focused on
developing and commercializing interventional treatment systems for
vascular disease LOUISVILLE, Colo. and ST. PAUL, Minn., Nov. 4
/PRNewswire-FirstCall/ -- Replidyne, Inc. (NASDAQ:RDYN) and
Cardiovascular Systems, Inc. (CSI) today announced that they have
entered into a definitive merger agreement under which CSI will
merge with Replidyne in an all-stock transaction. Under terms of
the agreement, Replidyne will issue new shares of its common stock
to CSI shareholders whereby former CSI shareholders are expected to
own 83 percent of the combined company, and Replidyne shareholders
are expected to own 17 percent of the combined company on a fully
diluted basis using the treasury stock method, subject to
adjustments as described in the merger agreement. David L. Martin,
President and Chief Executive Officer of CSI, said, "Executing this
transaction with Replidyne is an expedient way to take our company
into the public market and generate a capital infusion for future
growth. With an estimated $35 million to $40 million in additional
cash and investments from the merger, we can further expand our
sales and marketing organization and infrastructure to drive
revenue growth and continue to invest in product development for
future market expansion." "After a diligent process of evaluating
strategic alternatives carried out over several months, we believe
that a merger with CSI presents our investors with a very good
opportunity to realize future value," stated Kenneth J. Collins,
President and Chief Executive Officer of Replidyne. "Through our
process we have evaluated a broad array of opportunities across the
life sciences, molecular diagnostics and medical device industries.
After assessing the merger with CSI, we were impressed by the
strong launch of the Diamondback 360 degrees(TM), the growth
opportunity for treatment of peripheral arterial disease with this
product, particularly in calcified lesions, and the quality of the
management team driving the company." The boards of directors of
both Replidyne and CSI have unanimously approved the transaction,
which is subject to customary closing conditions, including
approval by the shareholders of each of Replidyne and CSI. The
merger agreement contains certain termination rights for both
Replidyne and CSI. The directors, as well as certain significant
shareholders, of each of Replidyne and CSI have executed voting
agreements in favor of the transaction. The transaction is expected
to close during the first calendar quarter of 2009. Upon
consummation of the merger, Replidyne's name will be changed to
Cardiovascular Systems, Inc. and the combined company will apply
for listing on The NASDAQ Global Market(R) under a new trading
symbol. CSI had filed for an initial public offering in January
2008, but withdrew its registration statement for the initial
public offering today. According to Martin, "The current equity
market conditions have resulted in the IPO market coming to a
standstill. Given the uncertainty regarding timing of a market
recovery, we believe that this transaction offers the best
opportunity at this time for continued growth and for our company
to gain access to the public capital markets." Morgan Stanley acted
as financial advisor to Replidyne and Cooley Godward Kronish LLP
served as Replidyne's legal counsel. Citi acted as financial
advisor to Cardiovascular Systems, Inc. and Fredrikson & Byron
P.A. served as CSI's legal counsel. About Cardiovascular Systems,
Inc. CSI is a medical device company focused on developing and
commercializing interventional treatment systems for vascular
disease. CSI's initial product, the Diamondback 360 degrees Orbital
Atherectomy System, is a minimally invasive catheter system for the
treatment of peripheral arterial disease, or PAD. PAD affects
approximately 8 to 12 million people in the U.S. PAD is caused by
the accumulation of plaque in peripheral arteries (commonly the
pelvis or leg), reducing blood flow. The plaque deposits range from
soft to calcified, with calcified plaque being difficult to treat
with traditional interventional procedures. The Diamondback 360
degrees is capable of treating a broad range of plaque types both
above and below the knee, including calcified vessel lesions, and
addresses many of the limitations associated with existing
treatment alternatives. The Diamondback 360 degrees utilizes the
orbital rotation of a diamond grit coated offset crown that is
attached to a flexible drive shaft. Physicians position the crown
at the site of an arterial plaque lesion and remove the plaque by
causing the crown to orbit against it, creating a smooth lumen, or
channel, in the vessel. The Diamondback 360 degrees is designed to
differentiate between plaque and compliant arterial tissue, a
concept known as "differential sanding." The particles of plaque
resulting from differential sanding are generally smaller than red
blood cells and are carried away by the blood stream. As the
physician increases the rotational speed of the drive shaft, the
crown rotates faster and centrifugal force causes the crown to
orbit, creating a lumen with a diameter that is approximately twice
the diameter of the device. By giving physicians the ability to
create different lumen diameters by changing rotational speed, the
Diamondback 360 degrees can reduce the need to use multiple
catheters of different sizes to treat a single lesion. In August
2007, the U.S. FDA granted 510(k) clearance for the use of the
Diamondback 360 as a therapy in patients with PAD. The Company
commenced a limited commercial introduction of the product in the
U.S. in September 2007 and began full commercial launch in the
first calendar quarter of 2008. Through September 30, 2008, nearly
11,000 Diamondback devices have been sold to more than 280
hospitals. Management and Organization The combined company will be
headed by CSI's Martin and CSI's executive team. The combined board
of directors will consist of 10 members, including two current
Replidyne directors, Edward Brown and Augustine Lawlor. The
Chairman of the Board will be Glen D. Nelson, M.D., currently
Chairman of CSI. The other members of the combined Board of
Directors will be Brent Blackey, John Friedman, Geoffrey Hartzler,
M.D., Roger Howe, Ph.D., Michael Kallok, Ph.D., David Martin and
Gary Petrucci. Conference Call Today at 8:30AM ET Replidyne and CSI
will host a joint conference call Tuesday, November 4, 2008 at 8:30
AM ET (7:30 AM CT, 5:30 AM PT) to discuss this transaction. Callers
may participate in the conference call by dialing 800-329-9097
(domestic) or 617-614-4929 (international), and providing the
passcode 89012165. To access the live webcast, log on Replidyne's
website at http://www.replidyne.com/ and go to the Investor
Relations section. A replay of the conference call will be
available approximately one hour after the completion of the call
through Tuesday, November 11, 2008 at midnight. Callers may access
the replay by dialing 888-286-8010 (U.S. participants) or
617-801-6888 (international participants). The audio replay
passcode is 13353327. To access a replay of the webcast, visit the
Investor Relations section of Replidyne's website at
http://www.replidyne.com/. Additional information about this
transaction is available online at http://www.replidyne.com/ or
http://www.csi360.com/. Safe Harbor This press release contains
plans, intentions, objectives, estimates and expectations that
constitute forward-looking statements about Replidyne and CSI that
involve significant risks and uncertainties. Examples of such
statements include, but are not limited to, the anticipated closing
date of the merger, the expected cash that will be available to CSI
at the closing of the merger, the expected ownership of the
stockholders of Replidyne and CSI after the closing of the merger,
and the anticipated benefits of the transaction. Actual results
could differ materially from those discussed in the forward looking
statements due to a number of factors including, the outcome of the
shareholder vote for the proposed merger, the outcome of
Replidyne's efforts to wind up its business including the
disposition of its research pipeline programs; regulatory
developments in the U.S. and foreign countries; the accuracy of
Replidyne's or CSI's estimates regarding expenses, future revenues
and capital requirements; and CSI's ability to obtain and maintain
intellectual property protection for product candidates. These and
additional risks and uncertainties are described more fully in
CSI's registration statement on Form 10 filed with the Securities
and Exchange Commission (SEC) on October 28, 2008 and Replidyne's
most recent Form 10-Q filed with the SEC under the Securities
Exchange Act of 1934. Copies of filings made with the SEC are
available through the SEC's electronic data gathering analysis and
retrieval system (EDGAR) at http://www.sec.gov/. All
forward-looking statements made in the press release are made as of
the date hereof and neither Replidyne nor CSI assumes any
obligation to update the forward-looking statements in the
document. Additional information about the Merger and Where to Find
It This communication may be deemed to be solicitation material in
respect to the proposed transaction between CSI and Replidyne. In
connection with the transaction, Replidyne intends to file a
registration statement on Form S-4 with the SEC containing a
related proxy statement/prospectus. The proxy statement/prospectus
will be mailed to the stockholders of Replidyne and CSI. Investors
and security holders of Replidyne and CSI are urged to read the
proxy statement/prospectus when it becomes available because it
will contain important information about Replidyne, CSI and the
proposed transaction. The proxy statement/prospectus (when it
becomes available), and any other documents filed by Replidyne or
CSI with the SEC, may be obtained free of charge at the SEC web
site at http://www.sec.gov/. In addition, investors and security
holders may obtain free copies of the documents filed with the SEC
by Replidyne by contacting Replidyne Investor Relations by email at
or by telephone at (303) 996-5522. Investors and security holders
may obtain free copies of the documents filed with the SEC by CSI
by contacting CSI by telephone at (651) 259-1000. Investors and
security holders are urged to read the proxy statement/prospectus
and the other relevant materials when they become available before
making any voting decision with respect to the proposed
transaction. Replidyne and CSI and their respective directors and
executive officers may be deemed to be participants in the
solicitation of proxies from their shareholders in favor of the
proposed transaction. Information about the directors and executive
officers of Replidyne and CSI and their respective interests in the
proposed transaction will be available in the proxy
statement/prospectus. This communication shall not constitute an
offer to sell or the solicitation of an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended. DATASOURCE: Replidyne, Inc. CONTACT: Mark
Smith, Chief Financial Officer of Replidyne, Inc., +1-303-996-5535;
or Marian Briggs, +1-612-455-1742, , or Nancy A. Johnson,
+1-612-455-1745, , both of Padilla Speer Beardsley for
Cardiovascular Systems, Inc. Web site: http://www.replidyne.com/
http://www.csi360.com/
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