Lake Region Medical, a company begun after World War II to make fishing tackle that branched out to provide pacemaker lead wires to Medtronic Inc. in the 1960s, has been acquired for $390 million by a Boston medical manufacturer in a cash-and-stock deal worth an estimated $390 million.
Don Spence, CEO of Accellent Inc., the acquirer, will become CEO of the merged company, it was announced Wednesday. Under terms of the deal, which was first announced in February, the combined company will operate under the Lake Region Medical name.
Joe Fleischhacker Jr., son of the founder and CEO until Wednesday of Chaska-based Lake Region, will join the merged company's board and serve on its executive management team. The Fleischhacker family owned most of the privately held company's stock.
"The new Lake Region Medical will have distinctive strengths in the interventional vascular business, and at the same time we expect to continue to grow our advanced surgical segment," Spence said in a statement Wednesday.
Said Fleischhacker: "We are very excited about the future and what the merger of Lake Region's strength in guide wires and wire-based medical devices with Accellent's strength in catheters will mean for our customers and employees.''
Lake Region has been a low-profile supplier to major medical device companies. With about 1,600 employees between Chaska and China, it operates more than 1 million square feet of manufacturing-and-distribution space at facilities in several states, Ireland, Europe and Asia.
Accellent's majority owner is private equity firm Kohlberg Kravis Roberts & Co., which acquired Accellent in 2005 for $1.27 billion in a debt-financed deal.
The company doesn't trade its common stock but has reported its results publicly as a result of an agreement with holders of its publicly traded debt.
However, under the terms of a recent refinancing, Accellent raised about $1.13 billion to buy Lake Region and pay off outstanding debt holders and will no longer file financial reports, according to documents filed in February with the Securities and Exchange Commission.
Lake Region doesn't disclose its revenue or other financial results.
Last November, Accellent reported that it lost $72 million on revenue of $387 million during the first nine months of 2013. The loss was driven by a $63 million write-down in the value of assets.