Atrium acquires Douglas Laboratories
Atrium Biotechnologies Inc. announced the acquisition of Pittsburgh-based HVL Inc. ("Douglas") whose main brand is Douglas Laboratories. Douglas has been marketing health and nutritional products through healthcare practitioners for over 50 years and has current annual revenues of approximately $80 million. By acquiring Douglas, Atrium now positions itself as the leader in this industry throughout the United States.
The transaction is immediately accretive, enabling Atrium to increase its adjusted earnings before interest, income taxes, depreciation and amortization (EBITDA) from approximately $31 million to about $48 million on a pro forma basis and therefore also increasing earnings per share of the Company by more than 50%, before synergies. Following the transaction, Atrium's pro forma revenues will exceed $315 million.
Under the agreement, Atrium will acquire Douglas for the total amount of $107 million ($US92 million), representing approximately 6.4 times the adjusted EBITDA generated by Douglas. Approximately $97 million will be paid in cash while the remainder, approximately $10 million, will be paid in Atrium subordinate voting shares issued to certain Douglas management shareholders at a price of $10.95 per share. The cash portion will come from cash on hand and the newly renegotiated credit facility that can be increased to $200 million, under certain conditions.
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