Clients in the News: Lifeline Systems
01/19/2006
Lifeline Systems to be Acquired by Royal Philips Electronics; Lifeline Shareholders to Receive $47.75 per Share in Cash
FRAMINGHAM, Mass.--(BUSINESS WIRE)--Jan. 19, 2006--Lifeline Systems Inc. (NASDAQ: LIFE) announced today that it has signed a definitive merger agreement with Royal Philips Electronics (NYSE:PHG, AEX:PHI) under which Philips will acquire Lifeline, a leader in personal emergency response services. Philips has agreed to acquire Lifeline for $47.75 per share or a total equity value of $750 million (equaling an aggregate value of $690 million net of $60 million cash and cash equivalents) in a transaction that has been unanimously approved by the Board of Directors of Lifeline. Completion of the transaction is subject to the terms and conditions of the merger agreement, which contains customary closing conditions and is subject to the approval of Lifeline's shareholders.
"The acquisition of Lifeline is an important step on our roadmap for growth in healthcare," says Gerard Kleisterlee, President and CEO of Royal Philips Electronics. "By targeting seniors and other people who want to continue living independently and exerting more control over their health and lifestyle," he added, "we aim to become a global player in the evolving home healthcare market."
The aging of the population provides strong underlying market growth for home healthcare solutions such as those offered by Lifeline. Today, seniors represent around 15% of the population in the developed world and are expected to almost double in size over the next 25 years. At the same time they are becoming increasingly active in managing their own health and wellness. Personal response services are already the largest category of home healthcare solutions purchased out-of-pocket by older adults and their caregivers. Still, penetration in the age group 65 years and older is just 2-3%, allowing for significant future growth.
Lifeline's revenues in 2005 are expected to be approximately $150 million, representing a 15% increase over 2004. A large part of the revenues are recurring in nature. Lifeline's operating margins in 2005 are expected to be approximately 15%. The company has a broad market presence in United States and Canada. The company markets its services through a network of more than 2,500 hospitals and other healthcare providers and serves a subscriber base of nearly 470,000.
Lifeline's twenty-four hours a day service gives independently minded seniors the confidence to maintain an active life at home, knowing if they suddenly need help, they can send an alert to a call-center that indicates they need assistance. Two-way communication allows a caring and extensively trained operator - who has instant access to the pertinent health history and personal profile of the caller - to establish the nature of the problem. Appropriate action can then be taken, including notifying a neighbor or family member, or summoning emergency services.
"Our many years of understanding consumers and their needs have led us to identify 'healthcare at home' as a key sector for us," stated Ivo Lurvink, CEO of Philips Consumer Health & Wellness. "Lifeline is a market-leader that offers us a platform for other home healthcare products and services. As such it complements our existing presence in telemedicine, showcased in Motiva, our advanced interactive healthcare system. We believe our brand, global presence, technology and innovation capabilities will accelerate the growth of the company and we're very much looking forward to working with their experienced management team and talented employees."
Lifeline President and CEO Ron Feinstein said, "Philips' acquisition of Lifeline represents the next phase in the continued evolution and growth of our company. This combination of two industry leaders opens up numerous product and technology synergies, as well as growth opportunities designed to both further and broaden Lifeline's founding mission of providing personal emergency response and support services to the at-risk elderly and their families to enhance their independence and quality of life."
Conference Call and Webcast
Lifeline will host a conference call this afternoon at 4:30 p.m. ET to discuss the acquisition. To listen to a live webcast of the conference call, please visit the Investor Relations section of Lifeline's website, www.lifelinesys.com. The conference call also can be heard live by dialing (888) 349-5690 or (706) 643-3945 prior to the start of the call. (Conference ID: 4521468.) A replay of the call also will be available on the Company's website.
About Lifeline
Established in 1974, Lifeline (NASDAQ: LIFE) is the leading provider of personal response services and emergency call systems in the United States and Canada. The company expects to report that, as of December 31, 2005, it supported approximately 470,000 subscribers from its response centers in Massachusetts, Ontario and Quebec. Lifeline also supplies emergency response equipment and services to owners and developers of independent and assisted living and continuing care retirement communities across North America. To people who live alone or in senior living communities, as well as their caregivers, the company provides reassurance and peace of mind with dedicated, well-trained people, advanced technology and a nationwide support structure designed to achieve service excellence. The company is committed to affording Lifeline subscribers and senior living residents the dignity, privacy and respect to which they are entitled. For more information about Lifeline Systems, visit: www.lifelinesys.com.
About Royal Philips Electronics
Royal Philips Electronics of the Netherlands (NYSE: PHG, AEX: PHI) is one of the world's biggest electronics companies and Europe's largest, with sales of EUR 30.3 billion in 2004. With activities in the three interlocking domains of healthcare, lifestyle and technology and 160,900 employees in more than 60 countries, it has market leadership positions in medical diagnostic imaging and patient monitoring, color television sets, electric shavers, lighting and silicon system solutions. News from Philips is located at www.philips.com/newscenter.
Reposted from
Lifeline Systems
About Garfield Group Interactive
Founded in 1995, Garfield Group Interactive (GGI) is an interactive marketing firm that consistently delivers strategic planning, award-winning design, and leading-edge technical services in order to achieve measurable business results. Teamed with its sister agencies, Garfield Group Branding and Garfield Group Public Relatrions, GGI serves a variety of markets - including vertical expertise in Biotech, Medical Device, and Pharmaceutical industries. Our clients include a number of leading companies such as Biogen Idec, Sepracor, Philips Lifeline, Reebok, and National Grid Wireless.
