Medical Care America to Sell Services Unit
DALLAS (AP) _ Medical Care America Inc. said Monday it has agreed to sell the home infusion services unit it acquired only 1 years ago to Caremark International Inc. for about $175 million in cash.
The company plans to use proceeds from the sale, along with up to $50 million of its own cash, to buy back up to 7 million of its 36.6 million outstanding shares in a tender offer priced at $26 to $29 per share, senior vice president Jonathan Bond said.
The deal, the latest in the fast-evolving health care industry, will beef up Caremark's home care business while allowing Medical Care to shed a distracting acquisition.
Donald Steen, Medical Care's president and chief executive, said the move "will allow us to focus resources on our surgery center business."
The sale also caps months of grumbling and speculation among some major Medical Care shareholders, who were angered when the company rebuffed a $950 million takeover bid late last year.
"It's just an effort to enhance shareholder value, and they certainly have indicated a desire to see us do that," Bond said. Among shareholders reportedly irked by the decision were members of Fort Worth's wealthy Bass family.
Last October, Dallas-based Medical Care rejected the bid from surgery center operator Surgical Care Affiliates Inc. Medical Care later said it would consider other offers and opened its books to prospective suitors. Bond said Medical Care received other bids, but he would not comment on them.
Under accounting rules, the deal with Caremark apparently would halt the type of stock-swap merger Surgical Care had sought with Medical Care, at least for several months.
"Our lawyers are researching that," said Joel Gordon, Surgical Care's chairman and chief executive. He said a confidentiality agreement kept him from commenting further on the deal but added that his company has "always been interested" in Medical Care.
Analysts said the proposed sale would let the company to remain independent, appease shareholder critics and buy time. …