Exhibit 99.1
CANTEL MEDICAL CORP.
150 CLOVE ROAD
LITTLE FALLS, NEW JERSEY 07424
(973) 890-7220
FOR IMMEDIATE RELEASE
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Contact: Richard E. Moyer
Cameron Associates, Inc.
Phone: 212-554-5466
Richard@cameronassoc.com
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CANTEL MEDICAL TO ACQUIRE MINNTECH CORPORATION FOR
$10.50 PER SHARE IN CASH AND STOCK
LITTLE FALLS, NEW JERSEY AND MINNEAPOLIS, MINNESOTA (MAY 31, 2001) ...
CANTEL MEDICAL CORP. (NASDAQ NM:CNTL) AND MINNTECH CORPORATION (NASDAQ NM:MNTX),
today jointly announced that they have entered into a definitive merger
agreement under which Cantel will acquire Minntech. The acquisition is part of
Cantel's strategic plan to further solidify its position as a leader in
infection control and medical device reprocessing. Minntech is a leader in the
development, manufacturing, and marketing of disinfection/reprocessing systems
for renal dialysis as well as filtration and separation and other products for
medical and non-medical applications. The transaction, valued at approximately
$70 million, will produce a combined company with approximately $125 million in
revenues for the twelve months ended April 30, 2001 and is expected to be
immediately accretive on a diluted EPS basis. The Boards of Directors of both
companies have approved the transaction, which is expected to close during the
third quarter of calendar 2001. Cantel has indicated that it plans to retain
Minntech's operations in Minneapolis, MN.
Under the terms of the definitive merger agreement, each share of
Minntech will be converted into the right to receive $10.50, consisting of $6.25
in cash, and a fraction of a share of common stock of Cantel having a value of
$4.25 (based on the average closing price of Cantel stock during a defined
period ending shortly before the merger). If, for example, the average closing
price of Cantel stock during such period is $23.00 (yesterday's closing price),
the fractional share (or "exchange ratio") will be .1848. The exchange ratio
will be adjusted upward or downward to provide a value of $4.25, but will not be
less than .1471 (the ratio if the average closing price during the period is
$28.89 or greater) nor more than .2833 (the ratio if the average closing price
is $15.00 or less).
Commenting on the transaction, Mr. Charles M. Diker, Chairman of
Cantel, stated "The Minntech acquisition will launch Cantel to another level in
leveraging its consistent track record of leadership, expertise and operating
performance in the growing area of infection control and medical device
reprocessing. Minntech's current business enjoys significant expansion
potential, which our management team will aggressively pursue."
Mr. James P. Reilly, President and Chief Executive Officer of Cantel,
noted, "Minntech enjoys a robust technology platform that will enable Cantel to
address a broader range of infection control needs as well as to develop a host
of new products for other medical and industrial filtration uses. The Minntech
acquisition opens new growth markets to us and presents a compelling opportunity
to further utilize our management, research and development and manufacturing
capabilities."
Cantel has agreed to nominate Dr. Fred L. Shapiro, a nationally
recognized nephrologist and co-founder and current Board member of Minntech, to
the Board of Directors of Cantel following the merger. Dr. Shapiro stated, "This
transaction enables our shareholders to receive both cash and a significant
equity interest in the combined company, which I believe has substantial growth
potential. We believe that the quality of Cantel's management, its existing
operations in the Minneapolis area and its intent to continue to expand the
business activities in which Minntech is currently involved makes this a very
exciting combination."
Utilizing its proprietary core technologies in chemicals, hollow
fibers, and electronics, Minntech has developed and currently markets a wide
variety of medical device reprocessing and fluid filtration and separation
products for the renal dialysis, medical device disinfection, cardiosurgery,
pharmaceutical, biotechnology and semiconductor industries. Minntech is a world
leader in renal dialyzer reprocessing, providing a broad product line that
includes a reprocessing system and a sterilant that each command the largest
market share in the U.S. in their respective categories. Over the years,
Minntech has developed over 155 patented medical technologies, with 87 patent
applications pending.
Cantel has received a commitment, subject to certain conditions, from
Fleet Bank, N.A., to provide a new credit facility to finance the cash portion
of the consideration to be paid in the merger. With respect to the stock portion
of consideration, the number of shares to be issued by Cantel will range from
approximately 967,000 to 1,863,000 shares, depending on Cantel's average closing
stock price during the specified period preceding the merger. The transaction
will be taxable and will be accounted for as a purchase.
The transaction is subject to customary closing conditions, including
the approval of the shareholders of each of Minntech and
Cantel. Under the merger agreement, Minntech has the right to terminate the
agreement if Cantel's average closing stock price during a defined period ending
shortly before the merger is below $13.24, unless Cantel elects to provide to
Minntech shareholders additional consideration, in cash or Cantel shares, at
Cantel's option, such that the total consideration is no less than $10.00 for
each Minntech share.
In connection with the execution of the merger agreement, certain
stockholders of Cantel, who are the beneficial owners of, in the aggregate,
approximately 37.6% of the outstanding shares of Cantel common stock, have
entered into a Voting Agreement, dated May 30, 2001, pursuant to which, among
other things, each such stockholder has agreed (and has granted a proxy) to vote
its shares of Cantel common stock in favor of the issuance of Cantel common
stock in the merger.
Nexus Health Capital, LLC has acted as financial advisor to Cantel,
Dresdner Kleinwort Wasserstein rendered a fairness opinion, and Fried, Frank,
Harris, Shriver & Jacobson provided legal counsel. U.S. Bancorp Piper Jaffray
Inc. has acted as financial advisor to Minntech and rendered a fairness opinion,
and Faegre & Benson LLP provided legal counsel.
Cantel will hold a conference call today at 2:30 p.m. EST. To
participate in the conference call, dial 1-888-855-5428 approximately 5 to 10
minutes before the beginning of the call. If you are unable to participate, a
digital replay of the call will be available from 8 a.m. EST on June 4, 2001
until 11:59 p.m. EST on June 8, 2001 by dialing 1-888-203-1112 and using
confirmation #467687. The call will be simultaneously broadcast live over the
Internet on vcall.com at HTTP://WWW.VCALL.COM/NASAPP/VCALL/EVENTPAGE?ID=69040. A
replay of the webcast will be available on Vcall for 30 days beginning June 4,
2001.
Cantel Medical Corp. is a healthcare company concentrating primarily in
infection prevention and control products and diagnostic and therapeutic medical
equipment. Through its United States subsidiary, MediVators, Inc., Cantel serves
customers worldwide by designing, developing, manufacturing, marketing and
distributing innovative products for the infection prevention and control
industry. Through its Canadian subsidiary, Carsen Group Inc., Cantel markets and
distributes medical equipment (including flexible and rigid endoscopes),
precision instruments (including microscopes and high performance image analysis
hardware and software) and industrial equipment (including remote visual
inspection devices). Cantel's subsidiaries also provide technical maintenance
services for their own products, as well as for certain competitors' products.
IMPORTANT INFORMATION: Investors are urged to read the proxy
statement/prospectus when it becomes available, and any other
relevant documents filed with the SEC as they will contain important details on
the proposed acquisition. (Investors can access documents filed with the SEC for
free at the SEC's web site WWW.SEC.GOV.)
Cantel and Minntech, and their respective directors and executive officers, may
be deemed to be participants in the solicitation of proxies from the
stockholders of Cantel and Minntech in connection with the merger. Information
about the directors and executive officers of Cantel and their ownership of
Cantel stock is set forth in Cantel's Annual Report on Form 10-K for the fiscal
year ended July 31, 2000. Information about the directors and executive officers
of Minntech and their ownership of Minntech stock is set forth in the proxy
statement for Minntech's 2000 annual meeting of stockholders. Investors may
obtain additional information regarding the interests of such participants by
reading the definitive joint proxy statement/prospectus when it becomes
available.
THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS. SUCH
STATEMENTS ARE ONLY PREDICTIONS, AND ACTUAL EVENTS OR RESULTS
MAY DIFFER MATERIALLY FROM THOSE PROJECTED. ALL
FORWARD-LOOKING STATEMENTS INVOLVE RISKS AND UNCERTAINTIES,
INCLUDING THE RISKS DETAILED IN CANTEL'S AND MINNTECH'S
REPORTS AND STATEMENTS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION.
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