Kirschner Medical Corp. said yesterday that it has rejected a revised bid from Texas suitor Maxxim Medical Inc. in favor of an already signed agreement to merge with Biomet Inc.
Maxxim had offered to acquire the stock of Kirschner, a Timonium orthopedics manufacturer, for $11.50 a share, 51 cents higher than Biomet's offer. Even after taking out a $1 million break-up fee that Biomet would have to be paid in the event of a breakup, the offer would come to $11.22 a share. That compares with $10.75 from Biomet.
On Thursday, Maxxim revised its offer to make it all cash, rather than a combination of cash and stock.
In rejecting the Maxxim offer, Kirschner's board had to consider a factors besides what appears on the surface to be a more lucrative offer -- including the probability that the transaction would ever be completed, said Lewis Parker, Kirschner chief financial officer. "That, among other things, played a role in their decision," Mr. Parker said.
Maxxim offered only a letter of intent, he said, while the Indiana-based Biomet signed a "definitive agreement" to merge and deposited $2 million of earnest money in Kirschner's bank account.
The bidding for Kirschner, which has so far involved three companies, began in May. Mr. Parker said his company would proceed with the Biomet merger, but he stopped short of calling yesterday's board action the last word in the bidding war.