Endocare to Buy Privately Held Galil Medical

Medical device maker Endocare Inc. is buying privately held Galil Medical Ltd in an all-stock deal that would give Endocare shareholders a 52 percent stake in the combined company.

The deal, which is expected to close in the first quarter of fiscal 2009, would form a company with a combined revenue of about $55.6 million for the twelve months ended Sept. 30, 2008.

The combined company will focus on the promotion and development of cryoablation, a minimally invasive method to freeze and destroy cancerous tumors.

“This combination has the potential to eliminate millions of dollars in redundant costs and we believe that annualized cost savings of over $10 million could be realized by mid-2010,” Endocare’s Chief Financial Officer Michael Rodriguez said in a statement.

Endocare said it also plans to sell $16.25 million of newly issued common shares for $1 a share in a private placement to certain institutional investors of Endocare and Galil, which is an Israel-based medical device maker.