Wound Management to acquire Juventas in all-stock deal

Wound Management Technologies (OTCQB:WNDM) said Wednesday that it has agreed to acquire Juventas in an all-stock deal in an effort to boost revenues.

Fort Worth, Texas-based Juventas' products are used primarily by medical specialists in both surgical, non-surgical therapy and regenerative medicine. The company operates a nationwide distributor network.

In consideration, Juventas owners will receive 12.5 million Wound Management shares as well as the ability to earn additional shares based on revenue targets, increasing the share consideration to 22.5 million. In addition, Juventas will also be represented on Wound Management's board of directors.

Wound Management said the deal will allow for revenue growth, allowing the company to manage its cash flow and increase sales efforts, also giving it direct access to Juventas' distributor network.
"The combined companies will be able to launch products into the market more effectively with Juventas having over 25 years experience in these markets," Wound Management said in a statement.
Both companies said they believe there is significant revenue and cost synergies to be realized from the transaction, leading to a signficant expansion in sales and profits for Wound Management.
Wound Mangement's core product is CellerateRX. Cleared as a medical device for all types of wounds except for third degree burns, and reimbursed by Medicare Part B, CellerateRX's activated collagen product provides the essential benefits of the collagen protein to a wound immediately, where other forms of native collagen require time for the body to break down the collagen for use in the wound healing process.

In people with compromised health or circulation, the difference in wound healing time can be significant. Because the product reduces pain, does not need to be removed from the wound, may not need additional dressing, and can be combined with other products if required, the cost savings with the use of CellerateRX alone provides competitive advantages.

The company has worked to bulk up its distribution channels for its core wound care product, boosting revenues to record highs, and prior to today's acquisition, forecast $12 million in sales for next year.

As part of the agreement, Juventas principals Jeff Ott and Bryant Gaines have agreed to join the new company, with Gaines coming on as COO of Wound Management effective immediately.

Gaines said: “Juventas chose to be acquired by Wound Management because of the opportunities we see in the combined company. We know that with WNDM’s proven products and our proven distribution practices, growth will be accelerated at a rate WNDM has not previously experienced.

"We are currently evaluating additional core products to add to our current offering for 2012 along with ancillary products to compliment our existing product offerings.”
Chairman and CEO of Wound Management, Scott Haire, added: “The marrying of our advanced wound care products with the superior medical device distribution network developed by Jeff Ott and Bryant Gaines at Juventas creates a value-driven enterprise for a fast growing public company and fully aligns all parties on increasing value. The deal is driven by one goal: to build long-term WNDM shareholder value by making CellerateRX and our other product lines the leading products in their respective markets."
"Jeff and Bryant, based on their previous relationships with major medical device manufacturers and other major players in the market, also have the ability to open many doors to further expedite business opportunities and grow revenue.”
Closing of the acquisition is subject to a number of conditions, including the audit of Juventas being completed by the first quarter of 2012, the company said.

CellerateRX, which is available in both powder and gel forms and is manufactured on a contract basis, has multiple target markets, and is distributed through five channels, including through partners such as the Military Shopping Channel, as well as through government initiatives, major healthcare service providers, biotech distributors and the international market.
Wound Management also has other biotech products in development including a patented resorbable bone wax line that is in late stages of development, as well as a subsidiary focused on technology for secure healthcare data collaboration and storage.