Hill-Rom Accused of Wrongfully Pulling Plug on Bardy Deal
- Bardy says Hill-Rom using proposed Medicare changes as pretext
- Bardy sued to force consummation of $375 million acquisition
Hospital-bed maker Hill-Rom Holdings Inc. is accused of wrongfully pulling the plug on a $375 million buyout of startup Bardy Diagnostics over changes to government reimbursement rates for its cardiac-monitoring system.
Officials of Seattle-based Bardy asked a Delaware judge to force Batesville, Indiana-based Hill-Rom to complete the acquisition, saying the proposed Medicare-payment revisions don’t provide a proper legal basis for nixing the deal.
“Hill-Rom is using the provisional reimbursement change and resulting uncertainty as a pretense to escape the deal it struck or to attempt to force (another) re-negotiation of the merger’s terms,” executives of closely held Bardy said in their Delaware Chancery Court lawsuit. The suit was filed Sunday and unsealed Monday.
Howard Karesh, a Hill-Rom spokesman, declined to comment on Bardy’s 32-page complaint. In a press release, the company said the prospect of “unexpected” reductions in Medicare reimbursements for patient-monitoring devices provided legitimate grounds to cancel.