Amicas Inc. (NSDQ:AMCS) and Merge Healthcare Inc. (NSDQ:MRGE) are fighting a war of words over Merge’s unsolicited offer to buy out the Boston-based imaging data management firm, which hopes instead to consummate a deal it already has with Thoma Bravo LLC.
Yesterday, Amicas called the Merge offer of $6.05 per share, or about $248 million, "risky" and "illusory," despite being a roughly 13 percent premium over the private equity firm’s ofer opf $5.35 per share (about $217 million).
The Amicas board of directors said the Merge proposal, its sixth takeover bid from the Milwaukee-based medical imaging solutions provider, was too dependent on unguaranteed third-party financing and took its Badger State competitor to task for failing to guarantee its financing for the deal.
In response, Merge put out a brief press release asserting that it has in hand a signed bridge financing commitment from Morgan Stanley to provide $200 million of debt financing for the deal.
"Based on that commitment and available cash, including $40 million of pre-funded equity investments from mezzanine investors, Merge has proposed to commence a $6.05 cash per share tender offer for all Amicas shares and to close the acquisition as quickly as possible thereafter," according to the press release.
That prompted another sharp riposte from Amicas, calling the Merge release "an eleventh-hour attempt by Merge to insert itself into a process that is well underway, and to disrupt Amicas’ definitive merger agreement with Thoma Bravo, damage Amicas’ operations, and mislead Amicas stockholders."
"Amicas has repeatedly requested that Merge’s third-party financing sources either guarantee or provide front-end funding such that Merge’s proposed transaction would be fully financed and contain transaction certainty. However, contrary to its statements about having committed financing, neither Merge nor its third-party financing sources will agree to provide a guarantee or front-end funding," according to the Amicas release. "Instead, Merge seeks to shift all financing risk to Amicas stockholders while inducing Amicas to terminate its guaranteed agreement with Thoma Bravo."
Should the Thoma Bravo deal founder, Amicas added, it stands to recoup only $10 million in break-up fees, "and even this is not payable under all circumstances," the company said. Setting the $10 million break-up fee alongside the potential $217 million the company would land if the Thoma Bravo deal goes through, Amicas said, and the "cost and accompanying risk" of the Merge offer is far greater.
"Despite Merge’s misleading statements and misrepresentations, nothing has changed regarding Merge’s highly-conditional, illusory and risky proposal, which the Amicas board has previously considered and rejected. Merge has still failed to provide financial guarantees and reasonable protections for Amicas or its stockholders," Amicas said in the release.
For its part, Merge said it "intervened in Massachusetts litigation challenging the adequacy of Amicas’ disclosures" about its offer and about the process the Amicas board used to consider buyout offers.
A spokeswoman for Merge did not immediately return a call for comment. An Amicas representative was said to be unavailable for comment.