* Revised offers were due Nov. 29 -sources
* Some private equity suitors see sale losing momentum
* Merge Healthcare shares close down 9.3 percent
By Greg Roumeliotis and Soyoung Kim
NEW YORK, Dec 5 Private equity firms vying for
Merge Healthcare Inc are waiting for a decision from
the company after the provider of medical imaging software
solutions sought revised takeover offers last week, three people
familiar with the matter said on Wednesday.
Chicago, Illinois-based Merge asked the few buyout firms
that remained in the auction - Thoma Bravo LLC, Thomas H. Lee
Partners LP and Francisco Partners - to resubmit final bids by
Nov. 29, the people said.
Some of the bidders believe that Merge is fully valued at
its current stock price at around $3 per share and any deal
would not offer much upside over the current trading level, the
The request to "refresh" bids was seen by some private
equity suitors as a sign that the auction has lost momentum and
Merge may struggle to get an offer that meets its price
expectations, two of the people said, requesting anonymity
because details of the process are private.
Merge declined to comment. Representatives of Thoma Bravo,
Thomas H. Lee and Francisco also declined to comment.
Merge shares ended trading down 9.3 percent at $2.82 on
Wednesday after hitting an intra-day low of $2.60, their lowest
level since June 28. The company has a market value of around
GTCR LLC, Welsh Carson Anderson & Stowe and Avista Capital
Partners were among other buyout firms that were pursuing an
acquisition of Merge earlier on, people familiar with the matter
told Reuters in November.
"We believe that the negotiations here are in the final
stages and, if financing terms and borrowing capacity are
amenable, Merge will be able to make a final decision on whether
to accept deal pricing within two to three weeks," Baird Equity
Research analysts wrote in a note on Nov. 27.
Merge Healthcare said in September that it appointed New
York-based investment bank Allen & Company LLC to evaluate
strategic alternatives, including a possible sale. The company
reported a third-quarter net loss per diluted share of 4 cents,
four times the loss it posted in the third quarter of 2011.
Merge Healthcare competed with Thoma Bravo in March 2010
when it agreed to buy AMICAS, a provider of healthcare imaging
solutions, for $248 million, scuppering a merger agreement with
the private equity firm.