SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT: October 21, 1997
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ROTECH MEDICAL CORPORATION
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(Exact name of Registrant as specified on its Charter)
Florida 59-2115892
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(State or jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4506 L.B. McLeod Road, Suite F, Orlando, Florida 32811
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (407) 841-2115
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Not Applicable
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(former name or former address, if changed since last report)
Item 5. Other Events
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On October 21, 1997, Integrated Health Services, Inc. (NYSE: IHS) and RoTech
Medical Corporation (Nasdaq: ROTC) jointly announced that they have completed
their previously announced merger. The stockholders of each company at
separate, but simultaneous, meetings have today approved the merger agreement
pursuant to which IHS acquired RoTech. Formal closing of the merger also
occurred today.
IHS issued approximately 15.4 million shares of common stock in the merger. The
equity value of the transaction is approximately $508 million. The total value
of the transaction, including the assumption of RoTech's debt by IHS and other
financial obligations, is approximately $858 million.
The merger is expected to be accretive to IHS earnings per share. The
transaction also services to strengthen the IHS balance sheet, reduce its
leverage, increase its margins and expand its services.
RoTech is the third largest provider of home respiratory services. Based on
their last reported quarter, RoTech has annualized revenues of approximately
$500 million and operates over 600 locations in 35 states. On a proforma basis
the consolidated company will have revenues of approximately $2.6 billion and
operate over 1,900 total post-acute locations in 46 states.
William P. Kennedy, Chairman and CEO of RoTech stated, "The management of RoTech
considers this an excellent opportunity for its patients, employees and
stockholders. The resources of IHS clearly position us to accelerate our growth
as well as offer additional services to our patients and payors."
Robert N. Elkins, MD Chairman and CEO of IHS stated. "We are extremely excited
about completing the merger with RoTech. This will be an outstanding
transaction for us and is a perfect strategic fit. We intend to not only have
RoTech continue its acquisitions of smaller home respiratory companies but also
expect to expand RoTech's acquisition activities, expand RoTech operations to
urban markets and expand RoTech's operations to include more managed care and
insurance payors."
"RoTech and its management team have a proven track record of over 50% compound
annual growth rate in revenues and earnings and is recognized as a quality
provider of home respiratory services" added Dr. Elkins. "We believe the
addition of RoTech strengthens IHS both financially and operationally".
Integrated Health Services is a highly diversified health services provider,
offering a broad spectrum of post-acute medical and rehabilitative services
through its nationwide healthcare network. IHS' post-acute services include
home respiratory services, subacute
care, inpatient and outpatient rehabilitation, long term care and home nursing
services. Supporting the full continuum of healthcare needs, IHS currently
operates over 1,900 post-acute service locations in 46 states throughout the
U.S.
Statements in this press release concerning the Company's business outlook or
future economic performances, anticipated profitability, revenues, expenses or
other financial items, anticipated cost synergies and product or service line
growth, together with other statements that are not historical facts, are
"forward-looking statements" as that term is defined under the Federal
Securities Laws. Any forward-looking statements are estimates, reflecting the
best judgment of IHS based upon currently available information and involve a
number of risks, uncertainties and other factors which could cause actual
results to differ materially from those stated in such statements. Risks,
uncertainties and factors which could affect the accuracy of such forward
looking statements are identified in the public filings made with the Securities
and Exchange Commission, and forward looking statements contained in this press
release or in other public statements of the Company should be considered in
light of those factors. There can be no assurance that these or other factors
will not affect the accuracy of such forward looking statements.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Report on 8-K to be signed on its behalf by the
undersigned hereunto duly authorized.
RoTech Medical Corporation,
a Florida Corporation
Dated: October 21, 1997 By: /s/ Rebecca R. Irish
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Rebecca R. Irish, Treasurer
and Chief Financial Officer