The Wall Street Journal-20080129-Inverness Medical to Acquire Matria in --36-900 Million Deal

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Inverness Medical to Acquire Matria in $900 Million Deal

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Inverness Medical Innovations Inc. said it will acquire Matria Healthcare Inc. in a cash-and-stock deal valued at $900 million that officials hope builds on the U.S. company's core focus -- women's health, oncology and cardiology.

Matria, based in Marietta, Ga,, provides programs for managing diseases and high-risk pregnancies. Through its health-enhancement and women's and children's health divisions, Matria provides services to more than 1,000 employers and managed-care organizations. The deal values each share of Matria at $39 -- $6.50 in cash and $32.50 in Inverness preferred stock -- a 27% premium to Friday's closing price. Inverness will also assume $280 million in Matria debt.

Matria stock rallied on the news, but then gave up its gains and a bit more; in 4 p.m. Nasdaq trading the shares were down seven cents, or 0.1%, at $30.67. Inverness stock fell sharply, down $4.26, or 8.2%, to $47.97 on the American Stock Exchange.

Inverness, based in Waltham, Mass., intends to consolidate Matria with the recently acquired Alere and Paradigm businesses to form a unit that focuses on the large and rapidly growing health management market.

Trying to boost its market share in an increasingly competitive market, Inverness has been on an acquisition spree, spending more than $700 million late last year in a series of deals. Earlier in 2007, it won a bidding war with Beckman Coulter Inc. for Biosite Inc., paying some $1.7 billion for the maker of medical-testing devices.