IntriCon Acquires Stake in Hearing Help Express
November 14 2016 - 4:04PM
Business Wire
Direct-to-Consumer Hearing Aid Provider
Accelerates Company’s Value Based Hearing Healthcare
Initiative
IntriCon Corporation (NASDAQ: IIN), a designer,
developer, manufacturer and distributor of miniature and
micro-miniature body-worn devices, today announced that it has
acquired a 20-percent stake in DeKalb, Illinois-based Hearing Help
Express, a direct-to-consumer mail order hearing aid provider.
IntriCon expects to exercise its option to acquire the remaining 80
percent of Hearing Help Express before the end of the year. Terms
of the transaction, assuming exercise of the option, include
approximately $1.3 million in cash, guaranty of a $2 million note
and an earn-out.
“Untreated hearing loss in the United States is a substantial
problem, and high device costs have created significant barriers to
access for most Americans,” said Mark Gorder, president and chief
executive officer of IntriCon. “Hearing Help Express offers a
lower-priced alternative for consumers to purchase devices
directly—circumventing layers of costs associated with the
conventional hearing aid channel.
“Additionally, Hearing Help Express has two decades of
experience and a proven track record of excellent customer care.
This acquisition gives IntriCon direct access to the emerging
value-based hearing healthcare market. It’s a platform we can build
on by leveraging our own technically advanced devices and making
targeted investments in management, marketing and advertising—and
ultimately incorporating an online component.”
Purchasing Hearing Help Express is a key evolution in IntriCon’s
value-based hearing healthcare (VBHH) strategy. Over the last
decade, the company has invested in the technical and low-cost
manufacturing (establishing facilities in Singapore and Indonesia)
to design and build superior devices and fitting solutions to
address the estimated $1 billion annual value hearing health
market. With the addition of Hearing Help Express, IntriCon now has
the channel infrastructure to directly reach the consumer
and—importantly for millions of consumers—the ability to offer
high-quality hearing healthcare at a fraction of the cost.
Said Gorder, “Through our VBHH initiatives and tests, we have
formed alliances with other key partners, which have given us
experience and key learnings as we move aggressively into a more
consumer-facing role. Our Hearing Help Express purchase provides an
efficient, established direct-to-consumer channel that we can build
on and expand via technology—and one that’s complementary with many
of our existing relationships.”
According to Gorder, the company expects that Hearing Help
Express and the direct-to-consumer channel will become an
increasing contributor to IntriCon’s sales and earnings—and the
company will use this opportunity to accelerate its business. Near
term, IntriCon is intently focused on the following:
- Identifying a vice president candidate
to lead Hearing Help Express—a search firm has been engaged and the
process is currently under way;
- Once leadership is in place, enhancing
Hearing Help Express’ sales and marketing capability, and ramping
up advertising—a tactic historically proven to drive sales;
and
- Introducing IntriCon’s digital hearing
aids and other technical advancements to Hearing Help Express’
customer base—currently Hearing Help Express offers primarily
analog products.
“We’re at a pivotal point in the evolution of the hearing health
industry. Fundamental change is needed and we’re excited about the
opportunity that we created through thoughtful hard work and
planning: a chance to deliver superior outcomes-based affordable
hearing healthcare. We’ll accomplish this by combining
state-of-the-art devices and software technology at a much lower
cost directly to consumers across the country, many of whom have
not been able to afford care previously. We expect that
capitalizing on this opportunity will lead to both a very bright
future for IntriCon and to long-term growth in shareholder value,”
concluded Gorder.
About IntriCon CorporationHeadquartered in Arden Hills,
Minnesota, IntriCon Corporation designs, develops, manufactures and
distributes miniature and micro-miniature body-worn devices. These
advanced products help medical, healthcare and professional
communications companies meet the rising demand for smaller, more
intelligent and better connected devices. IntriCon has facilities
in the United States, Asia, the United Kingdom and Europe. The
company’s common stock trades under the symbol “IIN” on the NASDAQ
Global Market. For more information about IntriCon, visit
www.intricon.com.
Forward-Looking StatementsStatements made in this release
and in IntriCon’s other public filings and releases that are not
historical facts or that include forward-looking terminology are
“forward-looking statements” within the meaning of the Securities
Exchange Act of 1934, as amended. These forward-looking statements
may be affected by known and unknown risks, uncertainties and other
factors that are beyond IntriCon’s control, and may cause
IntriCon’s actual results, performance or achievements to differ
materially from the results, performance and achievements expressed
or implied in the forward-looking statements. These risks,
uncertainties and other factors are detailed from time to time in
the company’s filings with the Securities and Exchange Commission,
including the Annual Report on Form 10-K for the year ended
December 31, 2015. The company disclaims any intent or obligation
to publicly update or revise any forward-looking statements,
regardless of whether new information becomes available, future
developments occur or otherwise.
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version on businesswire.com: http://www.businesswire.com/news/home/20161114006287/en/
At IntriCon:Scott Longval, CFO,
651-604-9526slongval@intricon.comorAt PadillaCRT:Matt Sullivan,
612-455-1700matt.sullivan@padillacrt.com
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