TLC Agrees to Buy Laser Vision For Stock Valued at $98.7 Million
TORONTO -- Facing an industry slowdown, Canadian laser eye-surgery provider TLC Laser Eye Centers Inc. agreed to acquire rival Laser Vision Centers Inc., St. Louis, for $98.7 million in stock, creating North America's biggest operator of laser eye-surgery clinics.</br></br>The deal brings together TLC's strength in urban centers with Laser Vision's share of the market in smaller towns and rural areas of the U.S., said TLC Chairman and Chief Executive Elias Vamvakas. The combination also will create about $10 million a year in cost savings and growth opportunities, said John J. Klobnak, Laser Vision's chairman and CEO.</br></br>"The industry has seen a slowdown," and "the street has been begging for consolidation in this industry," Mr. Klobnak said. Laser Vision has taken a step toward consolidation by agreeing to acquire closely held ClearVision Laser Centers, Lakewood, Colo., earlier this month for an amount that wasn't disclosed.</br></br>TLC said it is offering 0.95 of its shares for each Laser Vision share. Shares of Laser Vision jumped 62 cents, or 21%, to $3.63 in 4 p.m. trading on the Nasdaq Stock Market, while TLC shares fell 33 cents, or 7.6% to $4.01. Both companies' shares trade at a fraction of their historic highs. In 1999, Laser Vision reached $37 a share, while TLC hit $53 a share.</br></br>Demand soared in the late 1990s for laser treatment to correct astigmatism, nearsightedness and farsightedness, but it has leveled off during the past year. Analysts and industry officials say the economic slowdown has prompted consumers to delay the elective procedure, which is deemed cosmetic and isn't covered by most insurance plans.