20/11/2007 - 12:27

Eastland acquires medical equipment suppliers for $90K

20/11/2007 - 12:27

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Perth-based Eastland Medical Systems Ltd has acquired New South Wales-based Phoenix Medical Equipment Services Pty Ltd in a cash andscrip deal valued at $90,000, the company has announced.

Perth-based Eastland Medical Systems Ltd has acquired New South Wales-based Phoenix Medical Equipment Services Pty Ltd in a cash and scrip deal valued at $90,000, the company has announced.

In an announcement, Eastland said the acquisition would help the company capitalise on the growth of the aged care market.

 

 

The full text of an Eastland announcement is pasted below

Australian medical manufacturing and distribution company Eastland Medical Systems Ltd's (ASX: EMS) has strengthened its position in the Australian medical sector with the strategic acquisition of New South Wales based Phoenix Medical Equipment Services Pty Ltd, in a cash/scrip deal valued at A$90,000.

Phoenix Medical Equipment Services Pty Ltd is a market leader specialising in the supply, servicing and preventative maintenance of medical gas equipment, general medical equipment and first aid kits and supplies in the medical and aged care Industries.

The acquisition of Phoenix expands Eastland's presence in the medical services and equipment sector and adds electrical medical equipment maintenance services to the Eastland group's capability.

Synergies between Eastland's wholly owned subsidiary Medical Industries Australia (MIA) and Phoenix Medical Equipment Services, will enable Eastland to specifically capitalise on growth of aged care market through significant economy of scale savings.

Eastland CEO Dermot Patterson said acquiring Phoenix Medical Equipment Services would add value to MIA's growing equipment sales.

"Demand for quality aged care has seen federal and state governments raise the bar in terms of accreditation and occupational health and safety standards, which will see fundamental changes in quality of aged care facilities in Australia," Mr Patterson said.

There are an estimated 3,000 resident facilities in Victoria, New South Wales and Queensland. These facilities are under pressure to upgrade and meet quality guidelines by 2008-09.

"The acquisition of Phoenix strengthens Eastland's position in the Australian medical distribution market - creating synergies and cost savings - and will enable the group to capitalise on the changes and growth in the aged care sector," he said.

"Through MIA and Phoenix we can now supply a wide range of medical equipment and electrical beds with the provision of equipment maintenance repair and 24/7 service.

"Capital equipment sales and after sales service are also complemented by our ability to offer innovative financial lease/rent service packages, bundled with fast moving consumerable products."

The acquisition of Phoenix Medical Equipment Services, follows Eastland's recent announcement that it has entered into a conditional Agreement to acquire a controlling stake in the share capital of Star Medical (Botswana) Limited (Star).

This will result in Eastland increasing its holding in the issued capital of Star holding from 32 per cent to in excess of 55 per cent.

Star holds the rights to the Intellectual Property for the anti malaria treatment ArTiMist TM for the continent of Africa and the exclusive distribution rights for the North African countries.

Eastland South African subsidiary EMSSA hold the exclusive distribution rights for ArTiMist TM covering all of the sub-Sahara countries.

The agreement has been negotiated by the independent directors on arms length terms with Fee-Zone Pty Ltd; a company associated with Mr. Douglas Sims, a director of Eastland and of Star, and is therefore a related party transaction.

The purchase consideration consists of a parcel of 3,506,180 Eastland shares issued as fully paid at a deemed issue price of $0.30 cents per share, ranking only on completion and with a voluntary escrow period on these shares until 30th June 2008.

The deemed issue price of $0.30 cents is at a 76% premium on the current share price.

The transaction is conditional on Eastland shareholder approval in general meeting.

The Notice of Meeting and relevant Explanatory Statement will be issued by the Company in due course.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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