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A storage pool for Cobalt-60 isotopes, used in Nordion’s devices that sterilize food and single-use medical products. (Daniel Rogall/Nordion)
A storage pool for Cobalt-60 isotopes, used in Nordion’s devices that sterilize food and single-use medical products. (Daniel Rogall/Nordion)

U.S. firm sweetens bid for isotope maker Nordion Add to ...

The U.S. company trying to take over Canadian medical isotope maker Nordion Inc. has boosted its offer to try to get the deal done.

Sterigenics International Inc. said Monday that it is increasing its bid for each Nordion share to $13 (U.S.) from its previous price of $12.25. The earlier offer garnered support of 65.2 per cent of Nordion shareholders, just shy of the two-thirds support required for the sale to go through.

Nordion was set to hold a shareholder meeting last Tuesday, but when it realized – at the proxy voting deadline – that it did not have the necessary support for the deal, it postponed the vote to June 3. It has now pushed its meeting back further, to June 6.

A complicating factor is that there is another bidder in the wings, although Nordion will not identify who it is. This third party made a bid for Nordion early in May, causing Sterigenics to up its price to $12.25 from its initial offer of $11.75. The mysterious company made another offer late last week, of $12.50, pushing Sterigenics to increase its bid to $13.

At that price, Illinois-based Sterigenics will be paying about $805-million for all the outstanding Nordion shares.

Nordion stock rose about 8 per cent in early trading Monday morning, to $12.87 on the Nasdaq exchange.

Nordion has a long and storied history in the isotope business. It was created almost seven decades ago as the radium sales department of Eldorado Mining and Refining Ltd., then it took over the sale of radioisotopes from the nuclear research facility at Chalk River, Ont., before becoming part of Atomic Energy of Canada Ltd. in the 1950s.

It was part of MDS Health Group for two decades before being spun off as a standalone public company in 2010.

In March, after more than a year of studying “strategic alternatives,” Nordion’s board agreed to a sale to Sterigenics, a company that specializes in sterilization services for medical device makers, as well as pharmaceutical and food companies.

Nordion currently has two core businesses: selling systems that use radiation to sterilize medical devices and foods, and the processing of medical isotopes for the diagnosis and treatment of diseases.

If the sale goes through, Nordion will be delisted from the TSX and Nasdaq, although it will remain a separate entity and keep its name.

Even if the deal gets the required support from shareholders on Friday, there are a few more hurdles to overcome before the takeover closes later this year. It still needs Investment Canada approval, and Royal Assent of a federal budget bill that changed the foreign-ownership restrictions governing Nordion.

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