By OMAR FORD
Medical Device Daily Staff Writer
Contrary to popular belief, initial public offerings are still occurring in the med-tech space. The most recent IPO comes from Globus Medical (Audubon, Pennsylvania), a spinal implant manufacturer. The company said that it is expecting its IPO of 11.76 million shares to be priced somewhere between $16 and $18 a piece.
The company said that it is selling about 2.94 million shares of Class A common stock and the stockholders are selling about 8.82 million shares of Class A common stock, according to a Securities Exchange Commission filing. The company also noted in the filing, that it would not receive any proceeds from the sale of shares of Class A common stock to be offered by the selling stockholders.
The underwriters may also purchase up to an additional 1 .76 million shares of Class A common stock from the selling stockholders, at the public offering price, less the underwriting discount, within 30 days from the date of this prospectus to cover overallotments, if any.
The company declined comment when contacted Thursday by Medical Device Daily.
In the filing, the company stated that it intend to use the net proceeds received by it from this offering for working capital and general corporate purposes, including further expansion of sales and marketing efforts and continued investments in research and development. But it noted in that it does not have any specific uses of the net proceeds planned.
In a filing, the firm said that it had several risk factors, including intense competition.
"Our currently marketed products are, and any future products we commercialize will be, subject to intense competition. Many of our current and potential competitors are major medical device companies that have substantially greater financial, technical and marketing resources than we do, and they may succeed in developing products that would render our products obsolete or noncompetitive," the company said in the filing.
The company pointed out that it faced several significant competitors Medtronic (Minneapolis), DePuy (Warsaw, Indiana), Synthes (Solothurn, Switzerland), Stryker (Kalamazoo, Michigan) and NuVasive (San Diego). The company also pointed out in the filing that it faces competition from smaller spine market participants such as Alphatec Spine (Carlsbad, California), Orthofix International (Lewisville, Texas), and Zimmer (Warsaw, Indiana).
For the three months ended March 31, 2012, the company had sales of $94.7 million as compared to $78.3 million for the three months ended March 31, 2011, an increase of $16.4 million or 21%.
Yesterday, the company said that its board has approved a 1-for-3.25 reverse split of its common stock. The reverse stock split will become effective upon the filing of the amendment to its certificate of incorporation with the Delaware Secretary of State on July 31, 2012 (Medical Device Daily, Aug. 2, 2012).
At the effective time of the reverse stock split, each 3.25 shares of the company's outstanding common stock will be combined into one share of common stock. The reverse stock split affects all Globus Medical common stock and stock options outstanding immediately prior to the effective time of the reverse stock split.
In other financings;
Solta Medical (Heyward, California) said that it has priced an underwritten public offering of 5.7 million shares of its common stock at a price to the public of $2.65 per share. Net proceeds, after estimated underwriting discounts and estimated offering expenses, will be about $14 million.
In addition, Solta Medical has granted the underwriters a 30-day option to purchase up to an additional 855,000 shares of common stock solely to cover over-allotments, if any.
The offering is expected to close on or about Aug. 7, 2012, subject to customary closing conditions. Canaccord Genuity served as sole book-running manager and Roth Capital Partners served as co-manager for the offering.
Solta Medical currently intends to use the net proceeds from the offering for general corporate purposes.
SurModics (Eden Prairie, Minnesota), a provider of surface modification and in vitro diagnostic technologies to the healthcare industries, reported a plan to launch a modified "Dutch auction" tender offer to purchase shares of its common stock.
The company has announced that its board has authorized a modified Dutch auction tender offer for up to $55 million of the company's common stock. The tender offer is expected to commence on or about Aug. 6, 2012.
"Our confidence in our long-term financial outlook, the strength of our balance sheet, and our many growth opportunities has led us to announce our plan to return cash to shareholders through a tender offer. This tender offer reflects a strategic and disciplined use of cash that returns value to our shareholders, which is one of our key strategic priorities," said Gary Maharaj, president/CEO of SurModics.
A modified Dutch auction tender offer allows shareholders to indicate how many shares and at what price within the Company's specified price range they wish to tender.
CAS Medical Systems (Branford, Connecticut) reported that it has entered into a loan and security agreement with a total value of up to $6 million with East West Bank, a subsidiary of East West Bancorp. The financing is comprised of a $3.5 million three-year secured term loan and a $2.5 million revolving line of credit expiring in January 2014.
Thomas Patton, CEO of Casmed, said, "The increase in working capital, on such attractive terms, provides us with added flexibility as we work to make our FORE-SIGHT absolute cerebral oximeter a standard of care for patients in critical care, and introduce our next-generation, advanced monitoring products next year.
In connection with the loan agreement, Casmed has issued to East West Bank a five-year warrant to purchase 133,333 shares of Casmed common stock at a price of $1.80 per share.
Community Health Systems (Franklin, Tennessee) reported the completion of the previously announced cash tender offer by its wholly-owned subsidiary, CHS/Community Health Systems, for any and all of the issuer's approximately $934 million aggregate principal amount of 8-⅞% senior notes due 2015 then outstanding. The tender offer expired at 5 p.m., EST, on Aug. 1, 2012.
Omar Ford, 404-262-5546;
Published August 3, 2012