CML agrees to $151M for American Radiology Services acquisition
On Jan. 2, Health Imaging News reported that CML Healthcare had secured a commitment for $455 million U.S. (450 million CAD) credit facility from The Toronto-Dominion Bank. The credit facility provided: 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.
CML said Friday it is inviting ARS executives, Johns Hopkins University and Johns Hopkins Health System, and radiologists associated with ARS to keep minority stakes in the company. If they do so, the $151 million U.S. ($151.8 million CAD) purchase price will be accordingly reduced, CML said.
The acquisition is expected to be immediately accretive to the fund’s distributable cash, in accordance with GAAP. The transaction is scheduled to close in the first quarter of 2008 and is subject to customary closing conditions.
The Baltimore-based ARS is a provider of medical imaging services in the United States, with 17 clinics in Maryland and Delaware, and contracts with 11 hospitals in Maryland and 25 clinics in seven states.
The Missauga, Ontario-based CML, a private-sector provider of medical imaging services in Canada and a provider of laboratory testing services in Ontario, said the deal should provide the company with a larger conduit for growth than it has in Canada.