In late 1992, Empi, Inc., a $30 million medical device manufacturer, was worried about the potentially negative impact an important acquisition might have on its stock price. The acquisition would double its revenue base. But history showed that the stock price of the acquiring company usually drops. The investment community always has concerns about the ability of companies to integrate acquisitions into existing operations and to effectively manage the costs.
PSB helped Empi develop and execute a plan to manage presentation of the news by directly addressing what we thought would be the analysts' concerns.
Two days after the announcement, Empi's stock was up 23 percent. The company's market capitalization jumped $30 million. Furthermore, four analysts reaffirmed their buy recommendations and raised their earnings estimates while the company also garnered positive editorial coverage, including the above article from Investors' Business Daily.