In a move that would more than double its annual revenue to $100 million, wound care product company HemCon Medical Technologies Inc. has announced plans to acquire the publicly-traded Irish firm Alltracel Pharmaceuticals.
The acquisition will give HemCon, one of Portland's fastest-growing businesses, a strong and immediate presence in Europe, and will also offer Alltracel inroads into the U.S. market. The deal will also boost HemCon's manufacturing capabilities through access to Alltracel factories, and offer access to a proprietary nanotechnology manufacturing process called Nanospider.
The purchase is a cash-for-stock arrangement worth about $40.8 million in U.S. dollars, or $20.8 million pounds sterling, according to Thomson Financial News. The deal is subject to approval by Alltracel's shareholders and the Irish High Court, but HemCon leaders hope to close the sale in the second quarter. HemCon would take publicly-traded Alltracel private as part of the transaction.
Based in Dublin, Ireland, Alltracel manages commercial offices in London and Cologne, Germany. It also operates a research and development subsidiary in the Czech Republic and manufacturing facilities in Shenzhen, China. Alltracel focuses on taking proprietary technology from research stage to commercialization, including private-label oral care products licensed in Europe through the Butler and GUM brands.
To execute and broker the deal, HemCon formed a wholly owned subsidiary called Castlerise Investments Limited. The structure offered tax advantages for HemCon, company officials said. Alltracel will be a wholly owned subsidiary of HemCon following the acquisition, maintaining its headquarters in Dublin.
The two companies started doing business together about one year ago. Acquisition talks started soon after.
Founded in 2001, HemCon created a new type of bandage -- made from material extracted from shrimp shells called chitosan -- that bonds to even the most severe wounds within minutes of being applied. The company has reaped millions in military contracts, but is making a strong push into the civilian medical market in the U.S. and abroad. The company recently released an over-the-counter version of its bandages that it has distributed to more than 1,000 retail locations, including grocery stores and pharmacies.
HemCon has 110 workers and reported $24 million in revenue in 2006, up 100 percent from 2005. It reported just shy of $40 million in 2007.
HemCon President John Morgan said the recent tightening of credit markets made it somewhat challenging to obtain financing for the deal.
"It's a conservative credit environment, and we had to deal with that," Morgan said.
Bank of America N.A. is the lead financier for transaction.
The purchase is a cash-for-stock arrangement worth about $40.8 million in U.S. dollars, or $20.8 million pounds sterling, according to Thomson Financial News. The deal is subject to approval by Alltracel's shareholders and the Irish High Court, but HemCon leaders hope to close the sale in the second quarter. HemCon would take publicly-traded Alltracel private as part of the transaction.
Based in Dublin, Ireland, Alltracel manages commercial offices in London and Cologne, Germany. It also operates a research and development subsidiary in the Czech Republic and manufacturing facilities in Shenzhen, China. Alltracel focuses on taking proprietary technology from research stage to commercialization, including private-label oral care products licensed in Europe through the Butler and GUM brands.
To execute and broker the deal, HemCon formed a wholly owned subsidiary called Castlerise Investments Limited. The structure offered tax advantages for HemCon, company officials said. Alltracel will be a wholly owned subsidiary of HemCon following the acquisition, maintaining its headquarters in Dublin.
The two companies started doing business together about one year ago. Acquisition talks started soon after.Founded in 2001, HemCon created a new type of bandage -- made from material extracted from shrimp shells called chitosan -- that bonds to even the most severe wounds within minutes of being applied. The company has reaped millions in military contracts, but is making a strong push into the civilian medical market in the U.S. and abroad. The company recently released an over-the-counter version of its bandages that it has distributed to more than 1,000 retail locations, including grocery stores and pharmacies.
HemCon has 110 workers and reported $24 million in revenue in 2006, up 100 percent from 2005. It reported just shy of $40 million in 2007.
HemCon President John Morgan said the recent tightening of credit markets made it somewhat challenging to obtain financing for the deal."It's a conservative credit environment, and we had to deal with that," Morgan said.
Bank of America N.A. is the lead financier for transaction.
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