SANTA ANA, Calif., Jan. 8 /PRNewswire-FirstCall/ -- Advanced Medical
Optics, Inc. (AMO) (NYSE: EYE), a global ophthalmic surgical and eye care
products company, and IntraLase Corp. (Nasdaq: ILSE), today announced that the
two companies have entered into a definitive agreement for AMO to acquire
IntraLase for approximately $808 million in cash.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050324/AMOLOGO )
Under terms of the agreement, approved by the boards of directors of both
companies, following the receipt of fairness opinions from their respective
financial advisors, AMO will pay $25 in cash per share of IntraLase stock and
the individually determined cash value per share of outstanding stock options.
AMO has arranged committed financing from a consortium of banks to complete
the transaction. AMO expects the transaction to be completed early in the
second quarter of 2007. The transaction is subject to IntraLase stockholder
approval as well as regulatory approvals and other customary closing
"This acquisition offers significant strategic value by further
establishing AMO as the global refractive technology leader, positioning us
with a broad range of technologies and expertise to serve the needs of
comprehensive refractive practices," said AMO Chairman, President and CEO Jim
Mazzo. "We believe the transaction benefits eye care practitioners and their
patients by bringing together state-of-the-art technologies to define a new
standard of care in laser vision correction. Additionally, we believe the
transaction is financially attractive and will create significant operating
leverage and growth opportunities, as well as stockholder value."
"Besides the value that we believe will be created for both companies'
stockholders, we think this transaction provides truly unique opportunities,"
commented IntraLase President and CEO Robert J. Palmisano. "There will now be
the ability to advance our femtosecond laser technology in a coordinated way,
both developmentally and commercially, with the world's leading excimer laser
technology. Also, this combination provides the opportunity for further
innovation and beneficial refinement of LASIK procedures that can and should
grow the overall LASIK market." Mr. Palmisano concluded, "I am confident that
this combination will provide for better surgical procedures for patients,
happier customers and future opportunities for employees."
The addition of the IntraLase femtosecond laser technology into AMO's
portfolio of refractive technologies complements AMO's fundamental growth
strategy. Key benefits are expected to include:
- Builds a clearly differentiated position in the ophthalmic industry,
uniquely positioning AMO as the eye care professional's "complete
refractive solution," with a suite of corneal and lens-based products
and services that address a lifetime of refractive vision needs.
- Serves practitioners and patients across the globe by linking AMO's
market-leading Advanced CustomVue(TM) laser vision correction procedure
and market-leading IntraLase femtosecond laser innovations to define a
new standard of care: custom all-laser LASIK, a procedure that delivers
superior clinical outcomes and enhances surgeon productivity.
- Optimizes cross-selling opportunities between installed bases of both
- Combines R&D expertise in excimer lasers, femtosecond lasers,
diagnostics and optics.
- Blends two companies' infrastructures and core competencies to improve
operating leverage and create strong platforms for international
Revised Financial Guidance
AMO expects the transaction to be dilutive to 2007 adjusted earnings per
share (EPS) and slightly accretive to 2008 adjusted EPS. As a result of this
transaction, AMO expects amortization to increase by approximately $30 million
on an annualized basis, which would bring the company's total annual
amortization to approximately $70 million or about $0.70 per share on an
after-tax basis. For more information, see the "Use of Non-GAAP Measures"
section later in this release. Assuming successful close of the transaction
early in the second quarter of 2007, AMO's financial guidance is as follows:
Revenue (in millions) $1,060 - $1,080 $1,150 - $1,175 $1,350 - $1,370
Adjusted EPS $1.85 - $2.00 $1.40 - $1.55 $2.25 - $2.40
UBS Investment Bank is acting as lead financial advisor and Goldman Sachs
is acting as co-financial advisor to AMO. UBS Investment Bank is acting as
lead arranger of a $900 million acquisition facility for AMO. Bank of America
and Goldman Sachs are acting as joint-arrangers of the acquisition facility.
Bank of America is acting as lead financial advisor and JPMorgan is acting as
co-financial advisor to IntraLase. Skadden, Arps, Slate, Meagher & Flom LLP
is acting as legal advisor to AMO. Stradling Yocca Carlson & Rauth is acting
as legal advisor to IntraLase.
More than 1,200 surgeons worldwide have incorporated the IntraLase
Method(TM) into their LASIK practices. Many U.S. ophthalmic teaching
institutes, including Duke University Medical School, the Wilmer Eye Institute
at Johns Hopkins, the Bascom Palmer Eye Institute at University of Miami, and
Stanford University, use the IntraLase FS(TM) laser technology to train future
generations of LASIK surgeons.
The 4th generation IntraLase FS(TM) laser uses an infrared light beam,
generating 60,000 pulses per second, to prepare the intracorneal bed and
create the corneal flap in the first step of LASIK.
Key benefits of IntraLase's technology include:
- Using an "inside-out" process, the laser beam is precisely focused to a
point within the cornea.
- The laser pulses then create thousands of microscopic bubbles which
define the incision within the intracorneal surface.
- Along the edge, bubbles are then stacked up at a beveled angle - a
feature unique to the IntraLase Method(TM)- to the corneal surface to
complete the flap.
- From start to finish, the IntraLase Method(TM) typically takes 15-30
- The physician then exposes the prepared corneal bed for excimer laser
treatment (the second step of LASIK) by lifting the flap.
- The LASIK procedure is complete when the flap is securely repositioned
on its beveled edge.
AMO Laser Vision Correction Technology
- Enabling surgeons to more precisely control the first critical step of
LASIK including flap diameter, depth, hinge location and width, and
side cut architecture.
- Providing a perfectly thin and planar flap resulting in improved
- Enabling for precise repositioning, alignment and seating after the
LASIK procedure is completed, reducing the risk of flap displacement, a
complication occasionally seen after microkeratome flaps.
- Enhanced safety profile as evidenced in a presentation by Elizabeth A.
Davis, M.D. and Richard L. Lindstrom, M.D.: "Early Experience with the
30 kHz IntraLase."
- Clinically proven superior overall visual outcomes in both standard and
custom LASIK procedures with more patients achieving visual acuity of
20/20, 20/15, and 20/12.5 as evidenced in a presentation by Daniel S.
Durrie: "Randomized, Prospective, Contralateral Study of LASIK:
IntraLase laser Versus Mechanical Keratome."
AMO is the global leader in the design, manufacture and sale of laser
vision correction systems. More than six million vision correction procedures
have been performed worldwide using the company's laser systems.
AMO continues to build on the VISX heritage that began in 1986, with the
development of innovative technologies used to perform LASIK and other
refractive procedures. The company's CustomVue(TM) individualized laser vision
correction procedure uses wavefront-guided technology, enabling customized
correction based on comprehensive diagnostic measurement of optical errors in
an individual's eye. By utilizing proven Hartmann-Shack technology and Fourier
Analysis, the WaveScan Wavefront(R) system together with the STAR S4 IR(TM)
Excimer Laser System enable physicians to provide the broadest range of custom
wavefront-guided laser vision correction treatments to their patients. These
include, but are not limited to myopia, hyperopia, all forms of astigmatism,
and high myopia (up to -11 diopters), with or without astigmatism.
As the global leader in refractive surgical technology, AMO is committed
to developing and delivering innovative products that enhance visual outcomes
while expanding the range of people eligible for treatment.
About Advanced Medical Optics (AMO)
AMO is a global medical device leader focused on the discovery and
delivery of innovative vision technologies that optimize the quality of life
for people of all ages. Products in the ophthalmic surgical line include
intraocular lenses, laser vision correction systems, phacoemulsification
systems, viscoelastics, microkeratomes and related products used in cataract
and refractive surgery. AMO owns or has the rights to such ophthalmic
surgical product brands as ReZoom(TM), Clariflex(R), Sensar(R), CeeOn(R),
Tecnis(R) and Verisyse(TM) intraocular lenses, STAR S4 IR(TM) laser vision
correction system, WaveScan Wavefront(R) System, CustomVue(TM) procedure,
Sovereign(R) and Sovereign(R) Compact(TM) phacoemulsification systems with
WhiteStar(R) technology, Amadeus(TM) and Amadeus(TM) II microkeratomes,
Healon(R) viscoelastics, and the Baerveldt(R) glaucoma shunt. Products in the
contact lens care line include disinfecting solutions, enzymatic cleaners and
lens rewetting drops. Among the eye care product brands the company possesses
are COMPLETE Moisture PLUS(R), COMPLETE(R) Blink-N-Clean(R), Consept(R)F,
Consept(R) 1 Step, Oxysept(R) 1 Step, UltraCare(R), Ultrazyme(R), Total
Care(TM) and blink(TM) branded products. Amadeus is a licensed product of,
and a trademark of, SIS, Ltd. AMO is based in Santa Ana, California, and
employs approximately 3,800 worldwide. The company has operations in 24
countries and markets products in approximately 60 countries. For more
information, visit the company's Web site at www.amo-inc.com.
About IntraLase Corp.
IntraLase designs, develops, and manufactures an ultra-fast laser that is
revolutionizing refractive and corneal surgery by creating safe and more
precise corneal incisions. Delivering on the promise of ophthalmic laser
technology, the IntraLase FS(TM) laser, related software, and disposable
devices replace the hand-held microkeratome blade used during LASIK surgery.
The unsurpassed accuracy of IntraLase's computer-controlled femtosecond laser
has been shown to improve safety profiles and visual outcomes when used during
LASIK. Additionally, the IntraLase FS(TM) laser creates precision-designed
intracorneal incisions that when combined can be used during lamellar and
penetrating keratoplasty, and intrastromal ring implantation. IntraLase is
presently in the process of commercializing applications of its technology in
the treatment of corneal diseases that require corneal transplant surgery. The
company's proprietary laser and disposable patient interfaces are presently
marketed throughout the United States and 33 other countries. IntraLase is
headquartered and manufactures its products in Irvine, California. For
additional information, visit IntraLase's Web site at www.intralase.com.
Live Webcast and Replay
AMO and IntraLase will host a live Webcast to discuss the acquisition
announcement at 1:00pm ET today. To participate, please visit the
Investors/Media section of AMO's corporate website at www.amo-inc.com. The
Webcast will be archived and accessible through midnight ET on Monday, January
22, 2007 by visiting www.amo-inc.com.
Where You Can Find Additional Information About the Proposed Acquisition
IntraLase will file a proxy statement and other relevant documents
concerning the proposed acquisition with the Securities and Exchange
Commission (SEC). Investors and security holders are urged to read the proxy
statement when it becomes available and any other relevant documents filed
with the SEC because they will contain important information. Members of the
public will be able to obtain the documents free of charge at the website
maintained by the SEC at www.sec.gov. In addition, free copies of AMO's and
IntraLase's public filings may be obtained by directing a request to their
respective investor relations contacts. For AMO, contact Sheree Aronson at
(714) 247-8290 and for IntraLase contact Krista Mallory at (949) 859-5230, ext.
IntraLase and its directors, executive officers and certain other members
of management and employees may be deemed to be participants in soliciting
proxies from its stockholders in favor of the proposed merger. Information
regarding the persons who may, under the rules of the SEC, be considered to be
participants in the solicitation of IntraLase's stockholders in connection
with the proposed transaction will be set forth in IntraLase's proxy statement
for its special meeting. Additional information regarding these individuals
and any interest they have in the proposed transaction will be set forth in
the definitive proxy statement when it is filed with the SEC.
Use of Non-GAAP Measures
Our guidance for adjusted EPS for 2007 and 2008 is provided on a non-GAAP
basis. The company's adjusted EPS guidance excludes the impact of charges or
write-offs associated with acquisitions, reorganization or recapitalizations,
and unrealized gains or losses on derivative instruments. The company believes
this presentation is useful to investors to conduct a more meaningful,
consistent comparison of the company's ongoing operating results. This
presentation is also consistent with our internal use of the measure, which we
use to measure the profitability of ongoing operating results against prior
periods and against our internally developed targets. We believe that our
investors also use this measure to analyze the sustainable profitability of
the on-going business operations. The economic substance related to our use of
adjusted EPS is our belief that the appropriate analysis of our profitability
cannot be effectively considered while incorporating the effect of unusual
items and charges that have not been experienced in prior periods. The company
is not able to provide a reconciliation of projected adjusted EPS to expected
reported results due to the unknown effect, timing and potential significance
of special charges, and our inability to forecast charges associated with
future transactions and initiatives. Our guidance for adjusted EPS includes
the impact of transaction-related intangible amortization and stock-based
compensation expense now being recognized under Statement of Financial
Accounting Standards No. 123R (FAS123R) issued by the Financial Accounting
This non-GAAP financial measure are is in addition to and in conjunction
with results presented in accordance with GAAP. This non-GAAP financial
measure reflects an additional way of viewing aspects of our operations that,
when viewed with our GAAP results provide a more complete understanding of
factors and trends affecting our business. These non-GAAP measures should be
considered as a supplement to, and not as a substitute for, or superior to,
the corresponding measures calculated in accordance with generally accepted
Cautionary Statement Regarding Forward-Looking Statements
Statements contained in this document that refer to AMO's estimated or
future results such as statements regarding the timing and certainty of
closing the transaction, strategic and financial benefits of the transaction
and technologies, statements of Jim Mazzo and Bob Palmisano, statements under
the heading "Revised Financial Guidance," expectations regarding accretion,
integration and cost savings, and other financial guidance are forward-looking
statements within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. These statements are based on
management's current expectations and beliefs and are subject to a number of
factors and uncertainties that could cause actual results to differ materially
from those described in the forward-looking statements. The forward-looking
statements contained in this document include statements about future
financial and operating results and the proposed transaction. These
statements are not guarantees of future performance, involve certain risks,
uncertainties and assumptions that are difficult to predict, and are based
upon assumptions as to future events that may not prove accurate. Therefore,
actual outcomes and results may differ materially from what is expressed
herein. For example, if IntraLase does not receive required stockholder
approval or either of the companies fails to satisfy other conditions to
closing, the transaction will not be consummated. In any forward-looking
statement in which AMO or IntraLase expresses an expectation or belief as to
future results, such expectation or belief is expressed in good faith and
believed to have a reasonable basis, but there can be no assurance that the
statement or expectation or belief will result or be achieved or accomplished.
The following factors, among others, could cause actual results to differ
materially from those described in the forward-looking statements: risks
associated with uncertainty as to whether the transaction will be completed,
successfully integrating AMO and IntraLase, the failure to realize the
synergies and other perceived advantages resulting from the transaction, costs
and potential litigation associated with the transaction, the failure to
obtain the approval of IntraLase stockholders, the inability to obtain, or
meet conditions imposed for, applicable regulatory requirements relating to
the transaction, the failure of either party to meet the closing conditions
set forth in the definitive agreement, the ability to retain key personnel
both before and after the transaction, each company's ability to successfully
execute its business strategies, unforeseen impacts of AMO's 2006 recall of
eye care solutions, the extent and timing of regulatory approvals, and the
extent and timing of market acceptance of new products or product indications,
manufacturing, litigation, the procurement, maintenance, enforcement and
defense of patents and proprietary rights, competitive conditions in the
industry, business cycles affecting the markets in which any products may be
sold, fluctuations in foreign exchange rates and interest rates, and economic
conditions generally or in various geographic areas, including those set forth
in AMO's and IntraLase's most recent Annual Reports on Form 10-K and Quarterly
Reports on Form 10-Q, especially in the "Risk Factors" sections, and their
respective Current Reports on Form 8-K and other SEC filings. AMO is under no
obligation to (and expressly disclaims any such obligation to) update or alter
its forward-looking statements whether as a result of new information, future
events, or otherwise.
Advanced Medical Optics, Inc.
Investors and Media:
(949) 859-5230, ext. 260
SOURCE Advanced Medical Optics, Inc.