United American Acquires Pulse Systems LLC

United American Healthcare Corp. (UAHC; Detroit) has acquired privately held Pulse Systems LLC (Concord, CA). In the transaction, UAHC purchased all of the common units of Pulse Systems for $3.4 million in cash and then issued a $1.75 million promissory note due January 2, 2011. UAHC will also issue 1,608,040 shares of its common stock to the former Pulse Systems common unit holders, subject to the approval of its shareholders by December 31, 2010.

Heather Thompson

August 6, 2010

2 Min Read
United American Acquires Pulse Systems LLC

Pulse Systems provides contract manufacturing to the medical device industry, with a focus on precision laser cutting and processing of thin-wall tubular metal components, subassemblies, and implants, primarily in the cardiovascular market. For the fiscal year ended December 31, 2009, Pulse Systems generated revenue of approximately $9.2 million.

UAHC also announced that it has invested $750,000 to pay down Pulse Systems’ bank debt and, over the next 24 months, will invest another $3.99 million (including an initial payment made of $1.75 million) in Pulse Systems to redeem all of the acquired company’s preferred units.

If the UAHC shareholders do not approve the share issuance suggested by this transaction, then rather than issue UAHC common stock, UAHC will return Pulse Systems’ common units to the sellers, which constitutes 26% of the common equity of Pulse Systems.

“After an extensive review of our strategic alternatives, we have embarked on an acquisition that meets each of our key investment criteria, including significant revenue contribution, positive EBITDA and long-term growth potential,” says William C. Brooks, president and CEO of UAHC.  “While our pursuit of a strategic alternative was not limited to any specific industry, our purchase of Pulse Systems marks a new chapter in UAHC’s longstanding commitment to the healthcare industry—one that we expect will provide new opportunities in the dynamic medical device sector.”

Brooks continues, “One of the most exciting aspects of this combination is the significant long-term growth potential of our combined company, as well as the new, deeper leadership team we will gain. The capabilities of the Pulse Systems team should prove very important as we work to grow revenues over the long term.”

As part of the transaction, key members of Pulse Systems’ senior management team will remain with the company to guide future operations. The team includes Herbert J. Bellucci, CEO of the Pulse Systems operation, who has more than 30 years of experience in the medical device industry.

“We are pleased to join forces with the UAHC team,” said Bellucci. “Our focus combined with the institutional knowledge of the UAHC management team will allow us to achieve our long-term growth objectives, both organically and through potential future acquisitions.”

“After managing through the extraordinarily difficult business climate in 2008 and 2009, we are very pleased that our strategic review process has resulted in this promising initial transaction,” concludes Brooks. “We welcome our new team members and will rely on the knowledge and experience of our combined management team as we seek to build our company into a leader in the precision laser-based contract manufacturing industry.”

Sign up for the QMED & MD+DI Daily newsletter.

You May Also Like