SAC PCG & Lehman Brothers to invest in Cbaysystems Holdings

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CBaySystems Holdings Ltd. (AIM: CBAY), a holding company with a portfolio of investments in medical transcription, healthcare technology and healthcare financial services, today announced that affiliates of S.A.C. Private Capital Group, LLC ("SAC PCG") and Lehman Brothers have agreed to invest USD 123 million in CBaySystems Holdings.  The proposed investment will be made through a limited partnership and will consist of a subscription for new ordinary shares in CBaySystems Holdings at a price of 70p per share, equivalent to approximately 57.8% of the enlarged share capital of CBaySystems Holdings.  The proceeds of the investment will be used by CBaySystems Holdings to finance the proposed purchase from Koninklijke Philips Electronics N.V. ("Philips") of its approximately 69.5% shareholding in MedQuist Inc. (MEDQ.PK), the world's largest medical transcription services company.  The purchase price for Philips' shareholding in MedQuist is approximately USD 287 million, equivalent to USD 11.00 per MedQuist share and representing a 47% premium to the closing price of MedQuist shares on 21 May 2008.

 

Headquartered in Mount Laurel, New Jersey, MedQuist provides a suite of healthcare technology and medical transcription services to more than 1,500 hospitals and large physician practices in the US. For the year ended 31 December 2007, MedQuist reported total revenues of USD 340.3 million.

 

The subscription for shares in CBaySystems Holdings and the acquisition of Philips' shares in MedQuist are expected to close concurrently during the third quarter of 2008 and are conditional on applicable regulatory approvals, approval by the shareholders of CBaySystems Holdings and re-admission of the enlarged CBaySystems Holdings shares to trading on the AIM market, among other conditions. The closing of the share subscription will only occur if the conditions are satisfied and the purchase of Philips' shares in MedQuist is completed.  As the proposed acquisition amounts to a reverse takeover for the purposes of the AIM Rules for Companies, trading in the Company's issued share capital has been suspended with immediate effect pending the publication of a shareholder circular comprising an AIM Admission Document providing full details of the acquisition and notice of a general meeting, which is expected to be published in the third quarter of 2008. Upon the closing of the transactions, MedQuist will join CBaySystems Holdings' portfolio of operating companies, which includes CBay Systems & Services Inc., CBay Systems Private Ltd., and Mirrus Systems.  MedQuist will operate independently with its own executive management under the financial oversight of the holding company.  It is anticipated that, over time, synergistic opportunities may be identified among the operating companies within CBaySystems Holdings to enable them to enhance their portfolios of products and services, to accelerate growth, to improve operational performance, and to better serve the needs of their customers.

 

Raman Kumar, Chairman and CEO of CBaySystems Holdings, said: "MedQuist, as the world's largest medical transcription company, has impressive technology, management and employees. We look forward to working with the MedQuist team as it seeks to enhance MedQuist's revenue growth and to deliver an ever-expanding portfolio of products and services to MedQuist's customers. We welcome the support of SAC PCG and Lehman Brothers in this transaction, which we believe will be of significant value to all stakeholders."

 

Sourced From: Text 100 Public Relations Consultancy