Sonosite (Bothell Washington), a developer of hand-carried and point-of-care ultrasound, reported that it has reached an agreement to acquire CardioDynamics (San Diego). Under the terms of the agreement, SonoSite will acquire CardioDynamics in exchange for $1.35 per share in cash. The aggregate transaction value will be nearly $10 million, or $12.3 million net of cash and debt.

The price paid represents a 69% premium over the closing share price on June 8. The aggregate transaction value will include assumption of about $2.3 million of net debt. The boards of directors for both companies have approved the merger agreement.

The transaction is subject to customary regulatory approvals and approval by the shareholders of Cardio Dynamics and is expected to close in 3Q09. Approval by the shareholders of SonoSite is not required.

During the fiscal year ended Nov. 30, 2008, CardioDynamics generated revenues of $24.5 million and SonoSite had revenues of $243.5 million for its fiscal year ending Dec. 31, 2008.

The merger involves two well-known companies that haven't worked together in the past, Anne Bugge, a spokeswoman for SonoSite, told Medical Device Daily.

"We have had a longstanding goal of going into the cardiovascular management market," Anne Bugge, a spokeswoman for SonoSite told MDD Wednesday. "We have some products in the cardiovascular market, but this (acquisition) gives us an expansion into the pipeline."

Bugge said the two companies were complementary and declined to discuss specific details regarding how long the two companies have been in talks for the proposed merger.

"The acquisition of CardioDynamics is part of a strategic initiative that moves SonoSite forward toward our long-stated goal of adding clinical value and reducing healthcare system costs in cardiovascular disease management," said SonoSite President/CEO Kevin Goodwin.

"CardioDynamics is the platform we will build upon to achieve this goal," he said. "CardioDynamics has established a solid direct sales channel in the U.S. with 38 sales representatives calling on cardiologists, internal medicine and family medicine practitioners, primarily in physician office settings. We believe we can leverage this channel to build on our existing footprint in point-of-care markets."

In other dealmaking activity, CareFusion (Dublin, Ohio), the company that will become public from the planned spinoff of Cardinal Health's clinical and medical products businesses, reported filing a second amendment to its Form 10 registration statement with the Securities and Exchange Commission (SEC) that includes information about its post-spin board of directors and outlines progress being made to fulfill its obligations under a consent decree for its Alaris infusion products.

CareFusion also reported that the corrective action plan for field remediation of its infusion pumps, which the company submitted to the FDA in April as required by the amended consent decree, has been reviewed and found acceptable by the FDA. The company expects to issue a recall notification by June 12 to inform customers who have products affected by the recall, including details on remediation plans.

The company recorded an $18 million reserve in its fiscal third quarter for all actions related to the corrective action plan and continues to believe the amount to be sufficient to fulfill its remediation obligations.