PhotoMedex Inc. (Nasdaq: PHMD; TASE: PHMD) has announced the sale of its LCA-Vision subsidiary to Vision Acquisition for $40 million in cash. PhotoMedex bought LCA-Vision for $106 million on February 2014, just a year ago. PhotoMedex will realize net proceeds of approximately $35.3 million, excluding working capital adjustments and professional fees. Its secured creditors as well as its board of directors have approved this transaction, which closed on January 31, 2015.
Vision Acquisition has granted PhotoMedex sole and exclusive rights to provide certain excimer light source products, systems and equipment to LCA-Vision’s LasikPlus centers for the next seven years. The terms of each placement, if any, will be determined on a center-by-center basis.
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LCA-Vision operates 59 LasikPlus vision centers in the U.S., including 51 full-service LasikPlus fixed-site laser vision correction centers and eight pre- and post-operative LasikPlus satellite centers.
PhotoMedex says that it intends to use the proceeds from this transaction to pay down portions of its outstanding revolving line of credit and term loan, while continuing to pursue a refinancing of its secured debt.
“The sale of LCA-Vision allows PhotoMedex to repay certain indebtedness while providing exclusive rights to place XTRAC lasers for the treatment of psoriasis and vitiligo in LasikPlus centers, subject to negotiation with the new owners, ” said PhotoMedex CEO Dolev Rafaeli, “We look forward to focusing on our no!no!, Kyrobak, XTRAC and Neova businesses, among others, and to returning PhotoMedex to profitability. The people of LCA-Vision are among the best in the laser vision correction industry, and we wish them well in the capable hands of their new owners.”
LCA-Vision founded by Dr. Stephen Joffe, who served as its chairman and CEO until 2006. His son, Craig Joffe, who served as Chief Operating Officer, and Interim Chief Executive Officer, will serve as Chief Executive Officer of LCA-Vision.
Other senior executives of LCA-Vision, including Michael Celebrezze, Rhonda Sebastian and Bharat Kakar, are expected to remain with the company.
Vision Acquisition is controlled by Joffe family interests.