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MUNDELEIN, Ill. -- Medline Industries, Inc., a leading direct supplier of medical products and equipment to the healthcare industry, and RoundTable Healthcare Partners, an operating-oriented private equity firm focused exclusively on the health care industry, announced today they have agreed to acquire certain assets of Maxxim Medical, Inc. Maxxim, a manufacturer, assembler and marketer of specialty medical/surgical products, has been operating under Chapter 11 of the U.S. Bankruptcy Code since February 2003. This transaction resulted from a Section 363 auction held on Monday, October 27 and has received final approval from the US Bankruptcy Court and is expected to close within 10 business days.
Specifically, Medline will acquire Maxxim's surgical products (custom procedural trays and Boundary drapes and gowns) and medical products business (examination and surgical gloves). RoundTable, through Argon Medical Devices, will acquire Maxxim's vascular products business, based in Athens, Texas.
"This is a unique opportunity in which we get to help save a well respected company and its brands from bankruptcy and greatly enhance our leadership position in the marketplace," said Charlie Mills, CEO of Medline. "Combining Maxxim's strengths with those of Medline will enable us to better meet the needs of our customers. We also believe this acquisition will complement our strong organic growth."
"We are very excited about Argon as a platform investment within the attractive cardiovascular product industry. Argon enjoys a strong market position and has delivered consistently strong financial performance. Furthermore, as an independent company partnered with RoundTable, Argon's growth prospects will be enhanced overall," said Joseph F. Damico, founding partner of RoundTable and new chairman of Argon Medical Devices.
In addition to assuming the operations at Maxxim's custom procedure tray facility in Clearwater, Fla., Medline will add approximately 70 sales and marketing professionals including product specialists and nurse consultants from Maxxim, strengthening its existing 700 person sales force. Furthermore, Mills indicated that Medline will make a significant investment in Maxxim's existing infrastructure to upgrade and improve specific areas of the company's operations and customer service.
"Medline will honor existing contractual agreements Maxxim has with individual healthcare customers and group purchasing organizations by providing Maxxim products," said Mills. "We are also committed to continue making Maxxim products available through distributors and increasing inventory levels of those products to meet all customer needs."
Maxxim was purchased in a leveraged buyout transaction in November 1999, a transaction that was largely financed by debt. Despite remaining profitable from an operating perspective, the Company had an excessive amount of debt on its balance sheet, which was the primary reason the company decided to seek Chapter 11 relief. Chapter 11 of the Bankruptcy Code has allowed Maxxim to operate in the ordinary course of its business, subject to oversight by the Bankruptcy Court and the applicable provisions of the Bankruptcy Code and Bankruptcy Rules. The joint proposal submitted by RoundTable and Medline was approved on Oct. 28, 2003 under the jurisdiction of the Bankruptcy Court of the of Delaware.