Integrated Health Services said it has cut its purchase price for Coram Healthcare Corp. to about $184.4 million from $280 million.
Owings Mills, Md.-based IHS announced plans to acquire Denver-based Coram, a home infusion company, in October 1996. The deal would make IHS the largest U.S. provider of post-acute services.
Under the initial agreement, IHS agreed to pay an estimated $280 million in stock and assume $375 million of Coram's debt. The amended deal reduces the exchange ratio to 0.15 of a share of IHS common stock for each share of Coram common stock. The exchange ratio had been 0.2111.
IHS said it will now pay about $4.35 per share of Coram common stock. According to its most recent quarterly report, Coram has 42.4 million shares outstanding, bringing the new purchase price to $184.4 million. Neither party has disclosed the reason for the reduction.
The amended deal further requires IHS to pay a $25 million breakup fee if the merger is not completed by May 31, a date that can be extended 60 days. As under the earlier agreement, IHS will assume the $375 million in debt.
Coram said it has agreed to the new purchase price, but the shareholders of both companies must approve the deal. A shareholder vote has not yet been scheduled.
Coram last week also announced its 1996 results. For the year ended Dec. 31, Coram reported a net loss of $85 million, or $2.05 per share, compared with a net loss of $334 million, or $8.39 per share, in 1995. Revenues fell 15% to $522 million.