Merge Healthcare Completes Acquisition of AMICAS

MILWAUKEE & BOSTON--(BUSINESS WIRE)--Today’s successful close of the merger agreement between Merge Healthcare Incorporated (NASDAQ: MRGE) and AMICAS, Inc. (formerly NASDAQ: AMCS) creates a leading medical imaging software and healthcare IT solutions provider with strong customer relationships, innovative solutions, significant cross selling capabilities, and a solid international presence. With a combined customer base of approximately 1500 hospital and 2200 outpatient sites in the U.S. alone, a complementary product suite, and distribution agreements in over 35 countries, Merge is well positioned to capitalize on the expected growth in the global medical imaging and healthcare IT markets.

“Healthcare providers are facing reimbursement challenges, stimulus funding requirements, interoperability issues, and the need to improve effectiveness and efficiency of their clinicians”

“Merge and AMICAS each has a rich history of delivering innovative solutions for the medical imaging and healthcare IT markets,” notes Justin Dearborn, Merge CEO. “Despite some overlap in the outpatient imaging market, our solution sets are highly complementary. As a combined business, we will have excellent coverage for imaging and healthcare IT solutions across the continuum of care – from outpatient imaging sites to radiology, cardiology, and enterprise solutions serving the hospital market.”

For outpatient imaging businesses, the newly combined company will offer proven solutions for revenue cycle management, radiology information systems, referring physician connectivity solutions, radiology PACS and CAD solutions. For hospitals, Merge will offer robust interoperability and healthcare IT solutions, as well comprehensive departmental solutions for cardiology, radiology, and perioperative departments. Additionally, Merge will deliver the entire solution set internationally, through established global channels. In 2009 alone, Merge signed distribution contracts in 24 countries.

“Healthcare providers are facing reimbursement challenges, stimulus funding requirements, interoperability issues, and the need to improve effectiveness and efficiency of their clinicians,” said Mr. Dearborn, “and they want cost effective applications that will solve these challenges. Merge and AMICAS each has decades of experience with a core focus on medical imaging and healthcare IT software development, and the resulting long term customer partnerships. Together, we can more efficiently bring the right solutions to meet the demands of the market.”

This transaction completes the definitive merger agreement between Merge and AMICAS dated as of February 28, 2010, under which a subsidiary of Merge acquired all of the outstanding shares of AMICAS common stock for $6.05 per share. To finance the transaction, Merge successfully placed $200 million senior secured notes due 2015, and completed a private placement of preferred and common stock of $41.75 million. In conjunction with the completion of the transaction, the stock of AMICAS has ceased trading on the NASDAQ Stock Market.

Merge Healthcare develops and integrates information technology to create a better electronic healthcare experience. Merge products, ranging from standards-based development toolkits to sophisticated clinical applications, have been used by healthcare providers, vendors and researchers worldwide for over 20 years. Additional information can be found at www.merge.com.

This news release contains "forward-looking statements," including statements which are related to future, not past, events. Forward-looking statements usually describe expected future business and financial outlook or performance, and often contain words such as “will,” “believes,” “intends,” “anticipates,” “expects,” "plans," "seeks," “see” and similar expressions. Forward-looking statements, by their nature, address matters that are, to varying degrees, uncertain and subject to various known and unknown risks. For Merge, particular uncertainties and risks that could cause actual results to differ materially from post-merger forward-looking statements include, among other issues: the successful integration of AMICAS and Merge; achieving certain post-acquisition synergies; the market acceptance of implemented product solutions; market acceptance and performance of Merge’s products and services; the impact of competitive products and pricing; possible delays in the implementation of its managed services offering; the risks and effects of its recent changes in its executive and Board leadership, including the costs and expenses related to severance payments made to departing officers; the risks and effects of its recent securities issues, including the issuance of certain senior secured notes; the past restatement of its financial statements and other actions that may be taken or required as a result of such restatement; its ability to generate sufficient cash from operations to meet future operating, financing and capital requirements, including repayment obligations with respect to its outstanding indebtedness; risks associated with its prior delays in filings with the SEC or its ability to continue to meet the listing requirements of The NASDAQ Global Market; the costs, risks and effects of various pending legal proceedings; and other risk factors detailed in its filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made. Merge does not undertake any obligation to update forward-looking statements or any of risks, uncertainties and other factors.