ST. PAUL, Minn.--(BUSINESS WIRE)--April 19, 2004-- Transaction Strengthens Position of AbilityOne Unit In Sports Medicine And Podiatry Markets
Patterson Dental Company (Nasdaq:PDCO) today announced it has agreed to acquire Medco Supply Company, Inc., a leading national distributor of sports medicine, first aid and medical supplies based in Buffalo, New York. Terms for the all-cash transaction, which is expected to close in early May, are consistent with Patterson’s historic criteria for acquisitions.
A wholly-owned subsidiary of NCH Corporation, Medco will be consolidated into Patterson’s AbilityOne Products Corp. unit, the world’s leading distributor of rehabilitation supplies and non-wheelchair assistive patient products to the physical and occupational therapy markets. Medco is expected to be accretive to consolidated earnings during its first year as part of Patterson.
Medco consists of three businesses with sales totaling approximately $40 million:
-- Medco Sports Medicine, the largest operation, is one of the nation’s leading sports medicine distributors, selling to athletic trainers, chiropractors and physical therapists.
-- Masune First Aid & Safety sells first aid, safety and medical consumable products to a variety of customers, including day care centers, prisons, churches and theaters.
-- Surgical Supply Service sells consumable supplies to podiatrists, which is a developing customer base for AbilityOne.
Medco sells approximately 10,000 products through direct mail catalogs complemented by a sales force.
Peter L. Frechette, chairman and chief executive officer, commented: “We acquired AbilityOne in 2003, in part, to participate in the consolidation of the highly fragmented rehabilitation market, and our acquisition of Medco represents the continuation of this strategy. We view the rehabilitation market as an excellent long-term growth opportunity, and we plan to continue seeking attractive acquisition and internal growth opportunities to further build AbilityOne’s industry-leading position.”
Frechette added: “Medco is an excellent, solidly profitable company with a strong reputation in its targeted markets. This acquisition will strengthen AbilityOne’s position in the growing sports medicine market, while enabling us to further penetrate the podiatry market. We expect the process of consolidating Medco into AbilityOne’s operations to proceed rapidly.”
About Patterson Dental Company
Patterson Dental Company is a value-added distributor serving the dental, companion-pet veterinarian and rehabilitation supply markets.
Dental Market
As Patterson’s largest business, Patterson Dental Supply provides a virtually complete range of consumable dental products, equipment and software, turnkey digital solutions and value-added services to dentists and dental laboratories throughout North America.
Veterinary Market
Webster Veterinary Supply is the leading distributor of consumable veterinary supplies, equipment, diagnostic products, vaccines and pharmaceuticals to companion-pet veterinary clinics in the eastern United States and the third largest nationally.
Rehabilitation Market
AbilityOne Products Corp. is the world’s leading distributor of rehabilitation supplies and non-wheelchair assistive patient products to the physical and occupational therapy markets. The unit’s global customer base includes hospitals, long-term care facilities, clinics and dealers.
This release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are information of a non-historical nature and are subject to risks and uncertainties that are beyond the Company’s ability to control. The Company cautions shareholders and prospective investors that the following factors, among others, may cause actual results to differ materially from those indicated by the forward-looking statements: the ability to integrate Medco into AbilityOne’s operations in a timely manner; competition within the dental, veterinary, and rehabilitative and assistive living supply industries; changes in the economics of dentistry, including reduced growth in expenditures by private dental insurance plans, the effects of economic conditions and the effects of healthcare reform, which may affect future per capita expenditures for dental services and the ability and willingness of dentists to invest in high-technology products; the effects of healthcare related legislation and regulation which may affect expenditures or reimbursements for rehabilitative and assistive products; changes in the economics of the veterinary supply market, including reduced growth in per capita expenditures for veterinary services and reduced growth in the number of households owning pets; the ability of the Company to maintain satisfactory relationships with its sales force; unforeseen operating risks; risks associated with the dependence on manufacturers of the Company’s products; and the ability of the Company to successfully integrate the AbilityOne business. Forward-looking statements are qualified in their entirety by the cautionary language set forth in the Company’s filings with the Securities and Exchange Commission.
Contacts
Patterson Dental Company, St. Paul R. Stephen Armstrong, 651-686-1600 or
Equity Market Partners Richard G. Cinquina, 904-261-2210 or 800-522-1744