Mediq Incorporated informed the Federal Trade Commission late this afternoon that it has abandoned its proposed $100 million acquisition of Universal Hospital Services, Inc. in the face of an FTC antitrust challenge. The FTC had filed a complaint on Aug. 22 in federal district court seeking a preliminary injunction to block the merger pending the outcome of an administrative trial on grounds that the deal would violate federal antitrust laws. The FTC alleged that the transaction, which would have combined the nation's two largest firms that rent movable medical equipment -- such as respiratory, infusion, and monitoring devices -- to hospitals, would have given Mediq a dominant share of the rental markets both nationally and in many major metropolitan areas across the nation. Many hospitals and their group purchasing organizations had expressed concern that the merger would have led to higher rental prices because hospitals and hospital chains would not switch from renting to buying expensive equipment that may sit idle for long periods, even in the face of a significant rental price increase.
A hearing on the FTC's motion for a preliminary injunction was to begin this afternoon, but was canceled at Mediq's request. Mediq is based in Pennsauken, New Jersey, and is the largest rental firm of this type in the country. Universal is based in Bloomington, Minnesota, and is the second largest firm of this type.
The FTC had filed its complaint in U.S. District Court for the District of Columbia.
Copies of public documents related to this case are available from the FTC's web site at http://www.ftc.gov and also from the FTC's Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.
(FTC File No. 971 0066)
(Civil Action No. 97-1916 (SS))