And the Winner is…

 All right, where were we? Back in November, Philips had announced its intention to sale its 70% ownership interest in transcription software company Medquist, however leaving the crucial question unanswered: who would take over custody? The Dutch Giant showed up on stage again yesterday, providing the audience with a much clearer roadmap. So the winner is…

  • CBay Systems Holdings (AIM: CBAY) (“CBay”)
  • Sale price: USD 11.00 per share, or “approximately USD 285 million (approximately EUR 185 million). The USD 11.00 per share purchase price represents a premium of 47% over the most recent trading price of MedQuist’s stock.”
  • Big picture: “The acquisition of the approximate 69.5% shareholding in MedQuist will complement CBay Systems Holdings’ existing portfolio of businesses in medical transcription, healthcare technology, and healthcare financial services, including CBay Systems & Services Inc, CBay Systems Private Ltd. and Mirrus Systems.”
  • Time frame: “The sale of Philips’ stake in MedQuist is expected to close during the third quarter of 2008, and is conditional upon applicable regulatory approvals, approval by CBay shareholders at a general meeting of shareholders, and the fulfillment of specific closing conditions.”
  • Payment: “In connection with this transaction, Philips will receive cash and a promissory note equivalent to approximately USD 7.50 per share, amounting to approximately USD 195 million (approximately EUR 125 million). The remaining per share consideration of approximately USD 3.50 per share will be paid to Philips in the form of a 7-year bond convertible into common stock of CBay.”
  • Accounting wise: “The financial results related to this transaction, which are expected to be immaterial, will be booked under “Discontinued Operations” in Philips’ third quarter 2008 results.”

    (source: Philips, May 22, 2008 press release)

What a cool start for MEDQ Saga, Season Two…

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