Norland Medical Systems has signed an agreement to sell its bone measurement business to women's healthcare firm CooperSurgical (CSI). In exchange for substantially all of its assets, the White Plains, NY-based firm will receive up to a maximum of $12 million.
Norland will be paid $5 million (subject to certain retainage) plus additional amounts based on net sales of certain products over a three-year period, according to Norland. Lake Forest, CA-based CSI will also assume certain liabilities. Both firms expect the deal to be completed by April.
CSI, which has been a distributor of Norland's BMD products since November 2000, expects the deal will be neutral to earnings per share in 2002, and accretive in subsequent years. Thanks to new drug therapies supporting early diagnosis of osteoporosis, Cooper CEO Thomas Bender believes that bone density screening will become part of the routine physical for women 45 and over.
With its exit from the BMD business, Norland plans to turn its attention to the musculoskeletal market. The vendor said it would use the proceeds from the deal to pay off liabilities not assumed by CooperSurgical, and to finance research and development of products for musculoskeletal diagnostic, sports medicine, rehabilitative medicine, and pain management applications.
Norland experienced a challenging financial year in 2001. The company had fourth quarter revenue of $2.1 million, down 23.6% compared with the $2.8 million posted in the fourth quarter of 2000. For the period (end-December 31), the company reported a net loss of $427,000, compared with a 2000 fourth quarter net loss of $158,000.
For the year, Norland had revenue of $9.2 million, down 31.4% compared with the $13.4 million posted in 2000. The company had a net loss of $1.6 million, compared with a 2000 net loss (including non-recurring charges) of $13.3 million.
By AuntMinnie.com staff writersFebruary 28, 2002
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CooperSurgical to distribute Norland bone measurement systems, November 7, 2000
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