UNITED STATES
SECURITIES EXCHANGE AND COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 23, 1998 (July 9, 1998)
ARTERIAL VASCULAR ENGINEERING, INC.
(Exact name of registrant as specified in its charter)
0-27802
(Commission File Number)
Delaware 94-3144218
(State or other jurisdiction of incorporation (IRS Employer Identification No.)
or organization)
3576 Unocal Place, Santa Rosa, California 95403
(Address of principal executive offices) (Zip Code)
(707) 525-0111
(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS.
On July 9, 1998, Arterial Vascular Engineering, Inc. (the "Company")
announced the execution of a definitive agreement to acquire the coronary
catheter lab business (the "Business") of C.R. Bard, Inc. ("Bard") (NYSE:BCR),
as well as rights to the supply by Bard of certain materials, for approximately
$550 million in cash, subject to adjustment. The transaction is structured as an
acquisition of the assets and certain liabilities of Bard related to the
Business and the acquisition of stock of certain subsidiaries (the
"Subsidiaries") of Bard engaged in the Business. Pursuant to the definitive
agreement, AVE will not acquire any cash or accounts receivable of the Business
in consideration for the $550 million purchase price. However, AVE will purchase
the trade accounts receivable of the Subsidiaries for 95% of the "net" book
value of the Subisdiaries' trade accounts receivable as of the Closing Date
("net" meaning after deduction of the amount of the reserves for doubtful
accounts).
The acquisition is expected to be financed by term loans and revolving
credit facilities syndicated among various banks and financial institutions, a
commitment for which has been received by AVE. The financing commitment is
subject to conditions customary for transactions of this nature. AVE expects to
incur a significant one-time charge related to the acquisition, largely in
connection with the write-off of in-process research and development. The
acquisition is expected to be completed by the autumn of 1998, subject to
obtaining antitrust clearance in the United States and Ireland and certain other
closing conditions.
ITEM 7. EXHIBITS.
1. Press Release, dated as of July 9, 1998, entitled "AVE to Acquire Bard's
Coronary Catheter Lab Business."
2.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
ARTERIAL VASCULAR ENGINEERING, INC.
Dated: July 23, 1998 By: /s/ Lawrence J. Fassler
---------------------------------
Lawrence J. Fassler
Vice President of Legal Affairs,
General Counsel, Secretary
3.
<PAGE>
INDEX TO EXHIBITS
1. Press Release, dated as of July 9, 1998, entitled "AVE to Acquire Bard's
Coronary Catheter Lab Business."
4.
AVE LOGO
Arterial Vascular Engineering
Contact: John Miller FOR IMMEDIATE RELEASE
Chief Financial Officer
Arterial Vascular Engineering, Inc.
(707) 525-0111
AVE TO ACQUIRE BARD'S CORONARY CATHETER LAB BUSINESS
Santa Rosa, CA - July 9, 1998 -- Arterial Vascular Engineering, Inc.
("AVE") (Nasdaq National Market: AVEI) today announced a definitive agreement to
acquire the coronary catheter lab business of C.R. Bard, Inc. ("Bard")
(NYSE:BCR), as well as rights to the supply by Bard of certain materials, for
approximately $550 million in cash, excluding cash and certain receivables and
subject to adjustment. Bard's coronary catheter lab business develops,
manufactures and markets worldwide a broad range of catheter-based technologies
used in less invasive treatment of cardiovascular disease. Its product offerings
include coronary PTCA balloon catheters (including perfusion rapid exchange
catheters), guidewires, guide catheters, coronary diagnostic catheters and
guidewires; introducers and vessel closure devices; coronary stents; and various
other coronary components and accessories. In 1997, Bard's coronary catheter lab
business reported revenues of approximately $215 million. The acquisition will
enable AVE to immediately participate in new areas of interventional cardiology
through a wider product portfolio and access to new markets and customers.
The acquisition is expected to be financed by term loans and revolving
credit facilities syndicated among various banks and financial institutions, a
commitment for which has already been received by AVE. AVE expects to incur a
significant one-time charge related to the acquisition, largely in connection
with the write-off of in-process research and development. It is expected that
the transaction will be modestly accretive to AVE's fiscal and calendar 1999
results. The acquisition is expected to be completed by the autumn of 1998,
subject to obtaining antitrust clearance and certain other closing conditions.
"Our acquisition of Bard's coronary catheter lab business represents a
significant step in developing new businesses to complement coronary stents and
thereby becoming a broader and stronger company overall," said Scott Solano,
AVE's president and chief executive officer. "Bard is a respected player in the
interventional cardiology business, and this acquisition will allow us to
leverage our proven ability to effectively compete in new and growing medical
device markets with Bard's broad coronary product line. Its intellectual
property portfolio, including its rights to perfusion rapid exchange catheters
and certain balloon materials, provide a great complement to AVE's ongoing
research and development programs. It also possesses an investment interest in
and distribution rights to percutaneous transmyocardial revascularization
technology, and additionally has other attractive distribution and R&D
relationships."
-- MORE --
ARTERIAL VASCULAR ENGINEERING, INC.
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3576 UNOCAL PLACE Tel: (707) 525-0111
SANTA ROSA, CALIFORNIA 95403 Fax: (707) 525-0114
<PAGE>
ARTERIAL VASCULAR ENGINEERING
ADD ONE
"Bard's broad array of interventional cardiology components and
accessories will also strengthen AVE's leadership position in coronary stents,"
Mr. Solano continued. "The transaction will provide AVE with two
state-of-the-art manufacturing facilities in Billerica, Massachusetts and
Galway, Ireland, and over 1,900 employees in manufacturing, sales and marketing,
and research and development. AVE will also acquire additional direct sales
organizations abroad, thus expanding our global presence. Bard was an early
pioneer and leader in interventional cardiology, and we look forward to
expanding our leadership in coronary stent systems to this new market
opportunity in order to continue to provide the best available technology to
persons suffering from various forms of cardiovascular disease."
Headquartered in Santa Rosa, California, Arterial Vascular Engineering,
Inc. is a leading provider of highly specialized stent and balloon angioplasty
systems for less invasive interventional treatment of cardiovascular disease.
AVE sells its stent and balloon angioplasty systems in more than 40 countries,
including its coronary stent systems in the United States.
Except for the historical information contained herein, this news
release contains forward-looking statements that involve risks and
uncertainties, including the ability of the company to successfully integrate
the operations of acquired businesses and the risks of business acquisitions
generally, variations in the level of sale and earnings, the ability to manage
growth effectively, the ability to successfully introduce and achieve market
acceptance for new products and continued demand for products generally, the
effects of competition and pricing pressure, the rapid and significant
technological change that characterizes the medical device industry and the
ability to continue to respond to such technological change, as well as the
other risks detailed from time to time in documents filed by AVE with the SEC,
including the report on Form 10-K for the year ended June 30, 1997 and the
report on Form 10-Q for the quarterly period ended March 31, 1998.
###
A telephonic press conference will be held today, July 9, at 9:00am Eastern
Time. To participate in the conference, dial 719-457-2629 five to ten minutes
prior to the scheduled start time and reference Confirmation Code 505284.
ARTERIAL VASCULAR ENGINEERING, INC.
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3576 UNOCAL PLACE Tel: (707) 525-0111
SANTA ROSA, CALIFORNIA 95403 Fax: (707) 525-0114
