By Lisa Kerner
Charlotte, N.C., July 7 - Thermage, Inc. entered into a definitive agreement to acquire privately held Reliant Technologies Inc. in a stock and cash transaction valued at approximately $95 million.
The offer price is based on Thermage's July 3 closing price.
Under the agreement, Reliant shareholders will receive a total of approximately $25 million in cash and 23.6 million shares of Thermage common stock.
Thermage said it will also assume up to $7 million of net debt and provide $5 million in bridge financing to Reliant.
The proposed transaction brings together market leaders in skin tightening and skin resurfacing, the two fastest-growing segments of the aesthetics industry, the companies noted.
Both companies' boards of directors, along with Reliant stockholders, approved the proposed merger, which is slated to close during the fourth quarter of 2008.
Some Thermage stockholders, holding more than 33% of the outstanding shares of Thermage, agreed to vote in favor of the deal, the company said.
Annualized cost savings resulting from the combination are expected to be about $14 million.
"This proposed combination brings together two companies with premier technologies and market positions in their respective fields and creates a company with significantly more potential than either company can realize on its own," Reliant president and chief executive officer Eric Stang said in a news release.
According to Stephen J. Fanning, chairman of the board, president and CEO of Thermage, combining his company's products with Reliant's will provide patients and physicians with a more complete anti-aging solution.
"By combining our companies, we will be extremely well positioned to develop significant cross-selling opportunities as well as benefit from two business models that have significant consumable revenue," added Fanning, who will lead the combined Thermage.
The board of directors of the combined company will be comprised of the six current Thermage directors plus three directors selected by Reliant's current board.
Hayward, Calif.-based Thermage provides a non-invasive procedure to tighten and contour skin.
Reliant develops clinical solutions to repair and restore aging and damaged skin. The company is based in Mountain View, Calif.
| Acquirer: | Thermage, Inc.
|
| Target: | Reliant Technologies Inc.
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| Announcement date: | July 7
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| Transaction total: | $95 million
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| Expected closing: | Fourth quarter of 2008
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| Stock price of acquirer: | Nasdaq: THRM: $2.65 on July 3
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