ALPHARETTA, Ga., March 21 /PRNewswire-FirstCall/ -- Microtek Medical Holdings, Inc. , a leading manufacturer and marketer of infection control products, fluid control products and safety products to healthcare professionals, announced today that it has acquired KMMS Holdings, Ltd. and its European manufacturing and distribution operations (collectively, Samco). Headquartered in Malta and with distribution capabilities in Munich, Germany, Samco manufactures and sells a variety of disposable surgical products which complement Microtek’s existing product offerings. The financial terms related to the acquisition were not disclosed.
Dan R. Lee, Microtek’s President and CEO stated, “With its product lines, low cost manufacturing and direct German distribution capabilities, the Samco acquisition represents a key facet of our international expansion strategies. In financial terms, we expect Samco to add approximately $3.3 million in annualized revenues at margins consistent with those we enjoy from our U.S. branded business. We expect the Samco acquisition to be accretive to our earnings in 2006.”
Mr. Lee continued, “Samco’s distribution capabilities immediately strengthen our competitive position with high margin proprietary products and expand our OEM presence in Germany. Samco also offers a number of strategic advantages which will benefit our sales force throughout Europe. Several members of Samco’s former management and sales team will also join Microtek, further enhancing our international management team.”
“Over the years, we have worked very hard to build Samco into an excellent provider of proprietary branded products in Europe. Combining Microtek’s outstanding portfolio of infection control products with Samco’s products will improve our distribution capabilities,” stated Klaus Taubenthaler, Samco’s former director and newly appointed German Business Manager for Microtek. “I am looking forward to working with Microtek as we expand our collective distribution efforts.”
Mr. Lee concluded, “We are excited about the prospects that the Samco transaction holds for Microtek and its shareholders. As we work to integrate Samco into Microtek, we will continue to look for other strategic acquisitions which expand our market presence and implement our growth strategies.”
About Microtek Medical Holdings, Inc.: Microtek Medical is a leading manufacturer and supplier of innovative product solutions for patient care, occupational safety and management of infectious and hazardous waste for the healthcare industry. Headquartered near Atlanta, Georgia, the Company offers an extensive line of infection control, fluid control and safety products, such as disposable equipment and patient drapes, which are marketed to healthcare professionals through multiple channels, including direct sales, original equipment manufacturers (“OEM’s”) and private label arrangements. Microtek Medical’s goal is to provide healthcare professionals with innovative product solutions that encompass a high-level of patient care and prevention of cross infection in operating rooms and ambulatory surgical centers worldwide. For further information, visit www.microtekmed.com.
Actual Results Could Differ From Forward-Looking Statements: This Press Release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, the Company’s expectations that the Samco acquisition will add approximately $3.3 million in annualized revenues at margins consistent with the Company’s U.S. branded business margins, the Company’s expectation that the Samco acquisition will be accretive to its earnings in 2006, the Company’s belief that Samco’s distribution capabilities immediately strengthen the Company’s competitive position with high margin proprietary products and expand its OEM presence in Germany, the Company’s belief that the strategic advantages of the Samco acquisition will benefit its sales force throughout Europe, and the Company’s ability to identify and consummate other strategic acquisitions which expand its market presence and implement its growth strategies. Such statements are subject to certain factors, risks and uncertainties that may cause actual results, events and performance to differ from those referred to in such statements. These risks include, without limitation, the following: low barriers to entry for competitive products could cause the Company to reduce the prices for its products or lose customers; large purchasers of the Company’s products regularly negotiate for reductions in prices for the Company’s products, which may reduce the Company’s profits; because a few distributors control much of the delivery of hospital supplies to hospitals, the Company relies significantly on these distributors in connection with the sale of the Company’s branded products; the Company’s relatively small sales and marketing force may place the Company at a competitive disadvantage to its competition; the Company’s contract manufacturing division relies upon a small number of customers, the loss of any of which could have a material adverse impact on the Company; the inability of the Company to complete acquisitions of businesses at an attractive cost could adversely affect the Company’s growth; if the Company is successful in acquiring businesses, the failure to successfully integrate those businesses could adversely affect the Company; the Company’s growing international operations subject the Company’s operating results to numerous additional risks; markets in which the Company competes are highly competitive, which may adversely affect the Company’s growth and operating results; the Company’s products are subject to extensive governmental regulations, compliance or non-compliance with which could adversely affect the Company; the Company’s strategies to protect its proprietary assets may be ineffective, allowing increased competition with the Company; fluctuations in the value of the dollar against foreign currencies have in the past and may in the future adversely affect the Company’s operating results; and the Company’s expenses for raw materials and product distribution are adversely affected by increases in the price for petroleum. The foregoing risks are intended to identify some of the principal factors that could cause actual results to differ materially from those described in the forward-looking statements included herein. These factors should be read in conjunction with the more detailed risk factors included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2005 filed with the Securities and Exchange Commission. The Company does not undertake to update its forward-looking statements to reflect future events or circumstances.
Microtek Medical Holdings, Inc.
CONTACT: Dan R. Lee, President & CEO, or Jerry Wilson, CFO, or John Mills,Investor Relations, InvestorRelations@MicrotekMed.com, all of MicrotekMedical Holdings, Inc., +1-800-476-5973
Web site: http://www.microtekmed.com//
