www.cryocath.com Toronto Stock Exchange Symbol: CYT
MONTREAL, June 19 /CNW/ - CryoCath Technologies Inc. (TSX: CYT), the
global leader in cryotherapy products to treat cardiac arrhythmias, today
announced an agreement to sell their surgical portfolio to ATS Medical in a
US$22 million cash transaction. With milestone payments, the agreement could
reach a value of US$30 million. This strategic transaction is designed to
enable CryoCath to focus on their line of electrophysiology products for
treating atrial fibrillation and other arrhythmias, and will augment ATS's
current cardiac surgery portfolio.
CryoCath's surgical products are defined as its line of argon-based
cardiac surgical cryoablation devices, including products known under the
FrostByte(R) and SurgiFrost(R) names. Under the terms of the agreement,
CryoCath will receive US$22 million cash at closing, $2.0 million upon the
achievement of certain manufacturing transition milestones, $2.0 million two
years after closing and up to $4.0 million based on future sales of
SurgiFrost(R) XL, planned for commercial release in the second half of 2007.
"The sale of our surgical business marks a significant milestone in our
strategy to transition CryoCath into a focused and fast growing
electrophysiology cryoablation company," said Jan Keltjens, President and CEO
of CryoCath. "It also advances CryoCath towards the accomplishment of two core
goals. First, we now have a clear financial pathway to the U.S. approval and
launch of Arctic Front, our flagship product targeting the US$2 billion atrial
fibrillation opportunity. Secondly, we can focus to achieve rapid, profitable
growth in Europe for our EP-Afib business. Due to this increased focus as well
as the non-dilutive nature of the financing, we believe this transaction
creates great value for our shareholders."
"We are excited about the benefits that owning CryoCath's surgical
cryoablation business will bring to ATS Medical," said Michael Dale, President
and Chief Executive Officer of ATS Medical. "This innovative technology
enables us to dramatically leverage our current operating infrastructure and
provides us with a technological roadmap to address the rapidly-growing
surgical cardiac arrhythmia market in both the short and long-term."
The acquisition is subject to normal closing conditions and is expected
to close within 10 days. HSBC Securities (USA) Inc. acted as financial advisor
and Davies Ward Phillips & Vineberg LLP acted as legal advisor to CryoCath.
RBC Capital Markets acted as exclusive financial advisor and Oppenheimer Wolff
& Donnelly LLP acted as legal advisor to ATS Medical.
A CryoCath analyst and institutional investor conference call will be
held Wednesday, June 20 at 8:00 am (EST) to discuss the announcement. The call
will be webcast live at www.cryocath.com and archived for 90 days.
CryoCath - www.cryocath.com - is a medical technology company that leads
the world in cryotherapy products to treat cardiovascular disease. With a
priority focus on providing physicians with a complete solution of catheter
products to treat cardiac arrhythmias, CryoCath has multiple products approved
in the U.S., across Europe and several ROW countries. The Company is
developing additional products to expand its pipeline of products to treat
This press release includes "forward-looking statements" that are subject
to risks and uncertainties, including with respect to the timing of regulatory
trials and their outcome. For information identifying legislative or
regulatory, economic, climatic, currency, technological, competitive and other
important factors that could cause actual results to differ materially from
those anticipated in the forward looking statements, see CryoCath's annual
report available at www.sedar.com under the heading Risks and Uncertainties in
the Management's Discussion and Analysis section.
For further information:
For further information: visit our website at www.cryocath.com, or
contact: Michael Moore, Investor Relations, Phone: (416) 815-0700 ext. 241,
Fax: (416) 815-0080, E-mail: firstname.lastname@example.org