Emageon Waits Still

It looks like Emageon is still waiting at the altar. From HealthImaging.com:

Emageon, a developer of enterprise medical IT systems for hospitals and health care networks, reported that it has been informed by Health Systems Solutions (HSS) that it does not expect that Stanford International Bank will provide the funding necessary to consummate the parties’ planned merger transaction.

The deal was scheduled to close today, Feb. 11, in accordance with the terms of the parties’ amended merger agreement.

The Birmingham, Ala.-based Emageon said it “is evaluating its options in response to this development.”

At the time the Feb. 11 extension was established as the new closing date, Stan Vashovsky, CEO and board chairman of the New York City-based HSS, said the extension would “allow us additional time to complete our integration plan for our technologies. As a result, we will be in a better position to immediately serve the market upon closing.”

In October 2008, HHS signed a definitive agreement to acquire 100 percent of Emageon’s stock in an all cash transaction of approximately $62 million.

So we wait, I guess. For what it’s worth, Forbes has this to say about Mr. Vashovsky:

Stanley Vashovsky

Chairman of the Board/Director/CEO
Health Systems Solutions, Inc.
NY
Sector: TECHNOLOGY / Healthcare Information Services
Officer since September 2007

35 Years Old
Stan Vashovsky has been Chairman of the Board of Directors and Chief Executive Officer since September 2007. Mr. Vashovsky began his career as the founder of Medcare Corporation, a medical instrument business, in 1991 and Medcare Software Company, a provider of health care maintenance management software, in 1992. In 2001, Philips Electronics North America Corporation (“Philips”) acquired both companies and Mr. Vashovsky remained as President of the newly formed Philips Medcare. From January 2003 through June 2007, Mr. Vashovsky led Philips” Services Innovations Group which was responsible for developing technologies to supporting Philips Medical Systems Services Group.

Compensation for 2007
Salary $98,748.00
Bonus $0.00
Restricted stock awards $0.00
All other compensation $4,000.00
Option awards $1,826,660.00
Non-equity incentive plan compensation $0.00
Change in pension value and nonqualified deferred compensation earnings $0.00

Total Compensation
$1,929,408.00

Not bad. He could almost afford to buy Emageon all by himself.

Addendum:

My friend Mike Cannavo, the One and Only PACSMan, has done a little more research into this. Rather than reinvent the wheel, I’m just going to steal his posts from AuntMinnie. He won’t mind.

Re; the Emaegon/HSS merger snag, I find it curious that HSS’s stock prices dropped like a log on Friday, 3 days before the announcement that their Emageon merger would be “further delayed” and for all intents and purposes is over.. On 2/2 HSSO stock closed at $0.90. On 2/3 it skyrocketed to $1.95 where it stayed till 2/6 when it tanked again to $.75, close to where it stands today (no change in HSS stock price today either while Emageon lost almost 50% of its value so far). While HSS might say its meteoric stock rise coincided with speculation about its agreement with USIS to develop and implement a multi-phase Production Master Scheduling/Case Load Management system on a desktop/PDA-based application, this announcement was made on 1/30 (after market close) yet had absolutely NO IMPACT on stock prices on 2/2 (Monday), with the stock staying flat until Tuesday. One has to ask the obvious question then- with Emageon stock going from $1.94 on 1/27 to a high of $2.64 on 2/9 on the hopes that the merger was indeed going to happen yet HSSO tanked on the 6th losing more than half its value 3 days BEFORE the merger was officially dead one to ask the obvious question- did someone at HSSO share something they shouldn’t have before it was announced to the public? On the surface it sure seems fishy to me and inquiring minds want to know…The SEC also owes it to the investors in both companies to take a closer look at this “deal” as well. There is too much as stake here including the life of a company who has been in the PACS market for way to long to get jerked around like this. If the stock rises and falls are mere coincidence on the part of HSSO then they have nothing to worry about…except the $9M they stand to lose if the deal falls through. And if they do find something fishy, then please say hi to Bernie for me…… Let’s hope Emaegon says enough is enough, takes the cash promised (if they can get it that is), and courts another suitor and says adios amigos to HSS for good…..

This story gets weirder still by the minute. An anonymous source provided me with links to stories about the “investment firm” (Stanford International Bank) who was supposedly behind this deal and what I read makes my hair stand on end. Check it out yourself, with the last post (yesterday) referencing the Emageon deal as well:

http://caracasgringo.wordpress.com/2009/02/09/stanford-international-bank-antiguas-bernie-madoff/

http://www.portfolio.com/views/blogs/market-movers/2009/02/10/whats-going-on-at-stanford-international-bank

http://caracasgringo.wordpress.com/2009/02/11/dalmady-to-stanford-international-bank-show-me-the-money/

I can not attest to the veracity and accuracy of these reports and have never heard of the publications, but if they are even 10% true it leads to a host of questions, the biggest one being what was Emageon management thinking letting HSS use SIB to try to put together this deal? From one of these reports: “……the SEC started issuing subpeonas to Stanford Group in July, after two employees quit, saying “that the company gave clients false historical performance data for its securities”. If the SEC was investigating the company that should have been fairly easy to discern and were that the case a simple “that’s but no thanks” from Emageon to HSS would have sufficed. Instead younow have a lot of people down in Birmingham playing Job and wondering what’s next.. I hope the $9M that was supposed to be placed in escrow was indeed in escrow and not just pledged funds….and gets released to Emageon soon. At least that will buy Emageon a little time to figure out what’s next… Stay tuned….this thing is more interesting that a Spanish novela ..Ole`

Ole’? Oy Vey would be more like it…..

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