STAAR Surgical Company (Nasdaq: STAA), a leading developer, manufacturer and marketer of minimally invasive ophthalmic products, today reported that it will retire 1.7 million preferred shares through a cash payment to the Canon companies of $6.8 million. STAAR originally issued the 1.7 million Series A Convertible Preferred shares as part of the Company's December 2007 purchase of the remaining 50% interest in Canon Staar Co., Inc. STAAR has had the right to redeem the preferred shares after the first anniversary of the December 29, 2007 issue date at $4.00 per share. Because of STAAR's election to redeem, the holders' right to convert the shares to common stock expired on May 17, 2010.
"This transaction illustrates both the improved financial condition of STAAR Surgical, as well as our Board of Directors' confidence in the direction and growth opportunities of the Company," said Barry G. Caldwell, President and CEO. "By purchasing the 1.7 million convertible preferred shares at an approximately 20% discount to recent market prices for our common shares, we will generate a solid return to our shareholders. Based on the closing share price on May 20th, our purchase would create about $1.3 million in value for the nearly 35 million shares outstanding as well as eliminate the potential dilution if the shares had converted to common stock. The transaction also brings to full circle our late 2007 purchase of the 50% interest we didn't own in our Japanese joint venture with Canon. For a total consideration of $11.8 million, we purchased that 50% interest. Given the growth opportunities we have in the Japanese market with the recent approval of our Visian ICL, we believe this transaction will end up being an exceptional value for our shareholders. Finally, with this transaction, the only debt remaining on the STAAR balance sheet is a $5 million note also related to the Japan acquisition, which is due in December of this year," Mr. Caldwell concluded.
STAAR will complete the purchase the 1.7 million preferred shares on May 24, 2010 or on the soonest subsequent date when the share certificates are tendered.