Nilimedix signs Dutch, Belgian insulin pump distribution deal

Parent company D Medical acquires stock market shell to merge with Sindolor Medical.

D Medical Industries Ltd. (TASE:DMDC) has made a pair of announcements today and yesterday. The company announced that it was acquiring stock market shell Sela Group Communications Ltd. (TASE: SLA) for an undisclosed amount. In the second announcement, D Medical portfolio company Nilimedix Ltd. has signed an exclusive three-year distribution agreement in the Netherlands and Belgium. Vitility Innovations BV will distribute the company's Continuous Subcutaneous Insulin Infusion system for diabetics, and commits to buying €850,000 worth of the device over the period of the contract.

D Medical is acquiring Sela together with other investors, and intends to merge it with portfolio company Sindolor Medical Ltd., which is developing safety needles based on its proprietary EZject technology. D Medical owns 57% of Sindolor.

D Medical chairman Meni Mor told "Globes" that he planned to use Sela Group to acquire other medical device companies. "The crisis has created opportunities in this field, and we want to exploit them," he said.

Mor noted that all of D Medical's portfolio companies were alike, with the exception of Sindolor. "Nilimedix, G-Sense, and Medx-Set all develop devices related to blood-sugar, and all are managed from Carmiel by Avraham Shekalim. We own more than 90% of these companies, and they are all in the initial marketing stage or close to it."

Mor noted that Sindolor was in a different field from the other portfolio companies, which was why he wanted to spin it off.

Sindolor has US Food and Drug Administration (FDA) certification for its safety needles, but it is not yet ready for marketing. The company was on the verge of a major contract, but never closed the deal.

Sela Group will probably change its name. The deal includes a possible offering by the company without diluting the rights of D Medical or of the other shareholders in its portfolio companies. Mor said that there were no concrete plans yet for an offering, but that it would be considered when a suitable company for investment is found.

D Medical's share rose 2.5% in morning trading to NIS 1.12.

Published by Globes [online], Israel business news - www.globes-online.com - on August 20, 2009

© Copyright of Globes Publisher Itonut (1983) Ltd. 2009

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