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The acquisition is expected to close in the second quarter of 2008, and issubject to various closing conditions, including a requisite number of NMHCcommon shares being tendered into the offer, SXC obtaining financing pursuantto a commitment letter with GE Healthcare Financial Services and regulatoryapprovals. SXC expects to begin to realize synergies in the first year, whilecontinuing to invest in the migration of NMHC's claims processing systems tothe SXC platform. Excluding special items and including anticipated synergies,SXC expects the acquisition to be dilutive to SXC's EPS in fiscal 2008 andaccretive thereafter.
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"The acquisition of NMHC is an essential step in our strategic evolutiontowards leadership in Pharmacy Spend Management and will create value for thecompanies' customers, employees, and shareholders," said Gordon S. Glenn,SXC's Chairman and CEO. "NMHC's base of 300 customers and 2.3 million livesunder management, coupled with its established mail-order and specialtypharmacy operations, expands the capabilities of our full-service PBM offeringand is complementary to our traditional software license and ASP business,"said Gordon S. Glenn, SXC's Chairman and CEO. "In addition, NMHC has valuablerelationships with industry consultants and provides us with a customer basethat has critical mass with third-party administrators, managed Medicaid,state governments and Taft-Hartley organizations. This transaction helps usachieve our goal of providing a broad customer base with a comprehensive suiteof technology and benefits-management services under a flexible andtransparent pricing model."
Mr. Glenn continued, "SXC has a truly unique business model, offering ourclients a pathway for control of their pharmacy benefits program based upontheir individual needs. We continue to invest aggressively in our core licenseand ASP processing offerings, and now with the acquisition of NMHC, we havegreatly enhanced the capabilities of our informedRx(TM) full service PBMoffering. We are the only company in the PBM space to offer customers such abroad portfolio of solutions."
After closing, SXC's competitive position will center on an innovative mixof market expertise, information technology, clinical capability, scale ofoperations and mail order and specialty pharmacy offerings. The combinedcompany will be uniquely positioned to service a wide variety of healthcarepayor organizations including health plans, Medicare, managed andfee-for-service state Medicaid plans, long-term care facilities, unions,third-party administrators (TPAs) and self-insured employers. The combinedcompany is also expected to benefit from cost synergies and enhancedopportunities for revenue growth and increased profitability.
"We believe that our strengths in providing a full-service suite of PBMofferings will blend well with SXC's leadership in PBM info
