Affiliates of Vestar Capital Partners V, L.P. Successfully Complete Tender Offer for Shares of Health Grades, Inc.
08 October 2010 - 1:35AM
Business Wire
Mountain Acquisition Corp. and Mountain Merger Sub Corp., both
affiliates of Vestar Capital Partners V, L.P. (“Vestar”) formed for the purpose of acquiring
Health Grades, Inc. (Nasdaq: HGRD) (“HealthGrades”), and HealthGrades today announced
the successful completion of the cash tender offer for all of the
outstanding shares of common stock of HealthGrades at a purchase
price of $8.20 per share in cash, without interest and less any
applicable withholding taxes, as specified in the offer to purchase
dated August 10, 2010, as amended, and the related letter of
transmittal. The tender offer expired at 9:00 AM, New York City
time, on October 7, 2010.
“Now more than ever, consumers are looking for trusted sources
to help make informed healthcare choices,” said Roger Holstein,
managing director of Vestar and co-head of its Healthcare Sector.
“With more than 200 million annual visitors to the HealthGrades web
sites, the company is fast becoming America’s leading source of
information on physicians and hospitals. We are excited to partner
with the entire HealthGrades team in their mission to help
consumers make more informed healthcare choices.”
“In a world of increasing transparency and demand for
decision-making data, HealthGrades is well positioned to play an
important role that benefits all of healthcare’s varied
constituents,” said Kerry R. Hicks, chairman and chief executive
officer of HealthGrades. “With unique domain expertise, and a
portfolio of leading healthcare services assets, HealthGrades is
positioned for growth and expansion. Vestar will add significant,
real value as we expand our franchise and continue to build our
business with America’s consumers, their physicians and
hospitals.”
The depositary for the tender offer advised that, as of the
expiration time, 24,916,269 HealthGrades shares were validly
tendered and not withdrawn (not including 334,897 shares delivered
pursuant to notices of guaranteed delivery). Accordingly, Mountain
Merger Sub Corp. accepted for payment all such shares in accordance
with the terms of the tender offer. In addition, Mountain Merger
Sub Corp. purchased 5,108,954 shares directly from executive
officers of HealthGrades pursuant to previously disclosed tender
and support agreements with such officers. As a result of these
transactions, Mountain Merger Sub Corp. owned approximately 86% of
the outstanding shares of HealthGrades.
Mountain Merger Sub Corp. exercised its “top-up” option granted
under the terms of the previously announced merger agreement to
purchase approximately 12.651 million newly issued shares at $8.20
per share, which brought Mountain Merger Sub Corp.’s aggregate
ownership to more than 90% of the outstanding shares on a fully
diluted basis. Mountain Merger Sub Corp., as owner of more than 90%
of the outstanding shares of HealthGrades, intends to effect a
“short-form” merger under applicable Delaware law. Upon completion
of the merger, all remaining HealthGrades shareholders who did not
tender their shares in the tender offer (other than shares owned by
Mountain Merger Sub Corp., Mountain Acquisition Corp., HealthGrades
and their subsidiaries) will receive the same $8.20 per share in
cash, without interest and less any applicable withholding taxes,
paid in the tender offer. Mountain Merger Sub Corp. will be merged
with and into HealthGrades, and HealthGrades will be the surviving
corporation and a wholly-owned subsidiary of Mountain Acquisition
Corp.
About Vestar Capital Partners
Vestar Capital Partners is a leading global private equity firm
with more than 22 years of experience investing in middle-market
companies with $7 billion in assets currently under management.
From its headquarters in New York, and through its five offices in
the U.S. and Europe, Vestar employs its value-oriented investment
approach across a variety of industries in companies ranging in
total enterprise value from $250 million to $3 billion and
operations in five key industry sectors: consumer/services,
diversified industries, healthcare, media/communication, and
financial services. Vestar invests and collaborates with incumbent
management teams, family owners or corporations in a creative,
flexible and entrepreneurial way to build long-term franchise and
enterprise value. Since 1988, Vestar has completed 66 investments
in companies with total enterprise value of over $30 billion.
Vestar has operations in New York, Boston, Denver, Milan, Munich
and Paris. For more information, please visit
www.vestarcapital.com.
About HealthGrades
HealthGrades is the leading independent healthcare ratings
organization, providing quality ratings, profiles and cost
information on the nation’s hospitals, physicians, nursing homes
and prescription drugs. Millions of patients and many of the
nation’s largest employers, health plans and hospitals rely on
HealthGrades’ quality ratings, advisory services and
decision-support resources. The HealthGrades network of websites,
including HealthGrades.com and WrongDiagnosis.com, is a top-ten
health property according to ComScore and is the Internet’s leading
destination for patients choosing providers.
Visitors to HealthGrades.com find quality ratings and cost
information for the nation's approximately 5,000 hospitals and
16,000 nursing homes as well as in-depth profiles of the nation's
750,000 physicians. As a leader in the consumer revolution in
health care, HealthGrades receives more than eight million
unique visitors to its consumer websites each month. HealthGrades
helps hospitals understand, improve and communicate the quality of
care they deliver through a suite of products and physician-led
clinical-advisory services. HealthGrades currently works with
hospitals nationwide and produces well-respected public studies of
hospital quality in areas that include clinical excellence, and
patient safety. More information on the company can be found at
www.healthgrades.com.
Additional Information and Where to Find It
This announcement is neither an offer to purchase nor a
solicitation of an offer to sell securities. HealthGrades files
annual and special reports and other information with the U.S.
Securities and Exchange Commission (“SEC”). You may read and copy any reports or other
information filed by HealthGrades at the SEC public reference room
at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC
at 1-800- SEC-0330 for further information on the public reference
room. HealthGrades’ filings with the SEC are also available to the
public from commercial document-retrieval services and at the
website maintained by the SEC at www.sec.gov.
Safe Harbor Statement
This press release contains forward-looking statements,
including those relating to the anticipated acquisition of
HealthGrades by an affiliate of Vestar. These forward-looking
statements may be identified by words such as “anticipate,”
“expect,” “suggest,” “plan,” “believe,” “intend,” “estimate,”
“target,” “project,” “could,” “should,” “may,” “will,” “would,”
“continue,” “forecast,” and other similar expressions. Each of
these forward-looking statements involves risks and uncertainties.
Actual results or developments may differ materially from those,
express or implied, in these forward-looking statements. Various
factors may cause differences between current expectations and
actual results or developments, including risks and uncertainties
associated with the anticipated acquisition. Other factors that may
cause HealthGrades’ actual results or developments to differ
materially from those expressed or implied in the forward-looking
statements in this press release are discussed in HealthGrades’
filings with the SEC, including the “Risk Factors” sections of
HealthGrades’ periodic reports on Form 10-K and Form 10-Q filed
with the SEC. Copies of HealthGrades’ filings with the SEC may be
obtained at the “Investor Relations” section of HealthGrades’
website at www.healthgrades.com or at www.sec.gov. All
forward-looking statements in this announcement are qualified in
their entirety by this cautionary statement. Unless required by
law, Health Grades does not undertake to update its forward-looking
statements.
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