November 11, 2015
Heska Corp., a maker of blood analyzers and other veterinary diagnostic products, plans to enter the international market through the takeover of digital radiography manufacturer Cuattro Veterinary LLC.
Loveland, Colo.-based Heska intends to acquire Cuattro Veterinary for $6 million in stock and the assumption of $2.1 million in debt. Heska already owns 55 percent of Heska Imaging USA—formerly known as Cuattro Veterinary USA—which sells imaging equipment across the United States.
“This international expansion provides Heska with a strong and established platform for launching Heska’s blood diagnostics platforms and programs to international markets,” said President and CEO Kevin Wilson.
A shareholder vote is planned for late December, and the purchase is expected to close by Jan. 1.
The transaction comes amid leadership change at Heska. Company founder and executive chairman Robert Grieve stepped down Oct. 1.
Grieve, now a Heska consultant, received more than $900,000 in contracted payments and vested stock upon his departure, Heska stated today in its quarterly financial report.
Third-quarter revenue rose by 29 percent, to $28 million, from the same period in 2014. Some of the gain was tied to a distribution agreement signed in October 2014 with Henry Schein Animal Health, but CFO Jason Napolitano also credited Grieve.
“Bob and I worked together through some of the toughest financial times in Heska’s history, and I think it is fair to say [that] without Bob’s leadership and efforts the company would not have survived to thrive in the manner we have done this quarter,” Napolitano told financial analysts during a conference call.
Heska’s pending acquisition, Cuattro Veterinary, is active in Canada, Latin America, Europe, Australia and the Middle East, doing about $6 million in annual sales.
Heska will go head to head internationally with domestic rivals Idexx Laboratories Inc. of Westbrook, Maine, and Abaxis Inc. of Union City, Calif.
“Heska competitors earn up to 40 to 50 percent or more of their sales and profits from … international markets that until this morning Heska was not targeting,” Wilson told the analysts.
The company plans to “aggressively pursue those markets with advanced blood diagnostics and imaging bundles, a proven go-to-market model, and an expert and expanding team,” he added.
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