CML Healthcare Income Fund has entered into a definitive agreement to acquire American Radiology Services (ARS), a provider of diagnostic medical imaging services based in Baltimore.
ARS, in conjunction with The Johns Hopkins University and The Johns Hopkins Health System, is a provider of medical imaging services that performs approximately 2.2 million medical imaging scans per year. ARS operates 15 fixed-site multi-modality and two single-modality outpatient centers in Maryland and Delaware and provides radiology coverage to 11 hospitals in Maryland.
Through its operating division, American Radiology Solutions, ARS also provides primary or secondary reading services via its teleradiology network to 25 hospitals across seven states.
The Mississauga, Ontario-based CML said the acquisition is expected to be immediately accretive to the Fund’s distributable cash. The company also said it expects the transaction to close in the first quarter of 2008, subject to customary closing conditions.
CML also announced that it has secured a commitment for $455 million U.S. (450 million CAD) credit facility from The Toronto-Dominion Bank. The credit facility will provide: up to $354.5 million U.S. (350 million CAD) to fund the acquisition of ARS and repay certain indebtedness of CML HealthCare (if required); and $101.3 million U.S. ($100 million CAD) revolving credit facility for general corporate purposes, including future acquisitions. CML has arranged a committed credit facility for 100 percent of the purchase price of ARS.