Toano's Avid Medical Sold for $62M

By WYDaily Staff Friday, August 27, 2010

Avid Medical, a Toano-based manufacturer of custom procedure trays that serve the health care industry, has been sold.

Medical Action Industries Inc., a medical and surgical products supplier that specializes in single-use medical products, said today it had completed the buyout of Avid for $62.5 million in cash, plus transaction costs.

Avid will remain in Toano with current employees – no changes are expected, according to James City County Economic Development Director Keith Taylor.

"It kind of took us by surprise," said Taylor. His understanding is the plant and employees will stay put and the business continue to grow, with additional "ramping up" when Medical Action combines its business with Avid's, he said.

Medical Action said the buyout will increase its ability to serve health care providers in acute care facilities and surgery centers.

According to a press release issued by Medical Action, Avid had about $136 million in revenue during its most recent fiscal year, which ended March 31.

Michael Sahady, founder and CEO of Avid, will join Medical Action's board of directors, and Avid President and Chief Operating Officer Richard Setian will become vice president of sales and marketing.

“This strategic acquisition strengthens Medical Action’s core capabilities in developing, manufacturing and delivering quality medical products to hospitals and healthcare institutions,” said Paul D. Meringolo, CEO and Chairman of the Board of Medical Action Industries Inc. “The addition of custom procedure trays increases the breadth and depth of our product offerings and progresses us toward our initial goal of attaining $500 million in revenues."

Meringolo added that the market segment the company hopes to capture is estimated to be in excess of $2 billion.

Medical Action also expects to achieve significant cost savings and efficiencies driven by the combination of the two companies’ national sales forces which will create broader sales channels, increased service coverage, and dedicated focus to clinical and patient care products.