USRC to acquire DCA

Apr 15 2010

U.S. Renal Care, Inc. ("USRC"), a privately-held leading provider of outpatient dialysis services, and Dialysis Corporation of America (Nasdaq: DCAI) ("DCA"), a leading provider of outpatient kidney dialysis centers, announced today that they have entered into a definitive merger agreement for USRC to acquire DCA.

Under the terms of the agreement, USRC, through a subsidiary, will commence a tender offer for all of the outstanding common shares of DCA for $11.25 per share in cash, followed by a merger to acquire all remaining outstanding DCA shares at the same cash price paid in the tender offer. The offer price represents a premium of approximately 72 percent over yesterday's closing stock price. The transaction is valued at approximately $112 million.  

"USRC and DCA have a shared vision that is focused on providing outstanding dialysis services to patients with end stage renal disease," said Chris Brengard, Chairman and Chief Executive Officer of USRC.  "USRC and DCA each have built strong regional operations and this transaction permits us to build a more efficient and stronger national operation. DCA, like USRC, has a commitment to building joint ventures with nephrologists. We are excited about the possibilities going forward with DCA, and believe that our combined operations will result in continued quality improvement for our patients and value for our stakeholders."

Upon the closing of the transaction, USRC will provide dialysis services to a base of approximately 5,500 patients through 84 outpatient dialysis facilities across nine states, more than 12 home dialysis programs, and 24 dialysis programs within acute and specialty hospital facilities.

Thomas  K. Langbein, Chairman of the Board of DCA, said, "We believe this transaction will be beneficial to both companies' physicians, patients, and employees.  For shareholders, the transaction provides a compelling opportunity to realize the value DCA has created."

Stephen Everett, President and CEO of DCA added, "Combining DCA and USRC creates a stronger enterprise while preserving the cultures of the two companies which focus on quality patient care in partnership with top shelf physicians."

DCA's Board of Directors unanimously approved the transaction, which is subject to customary closing conditions, including the valid tender of a majority of the total number of shares of common stock of DCA outstanding on a fully-diluted basis. Directors and executive officers of DCA holding approximately 23 percent of DCA's outstanding common stock have entered into agreements to, among other things, tender their shares into the tender offer. USRC expects to commence the tender offer promptly and expects the transaction to close in May 2010.  

USRC's financial advisor for the transaction is RBC Capital Markets and its legal advisor is Fulbright & Jaworski, L.L.P. Royal Bank of Canada has delivered to USRC a commitment letter providing fully committed debt financing in connection with the transaction. Three of USRC existing equity sponsors - SV Life Sciences, Cressey & Company, and Salix Ventures - are providing additional equity financing to USRC to support the transaction. DCA's financial advisor for the transaction is Dresner Partners and its legal advisor is Arent Fox LLP.