Cantel Origins

Cantel originated from a business that Walter Carsen founded in 1946. Walter went to London as a teen ager with the objective of learning about the optical industry. In 1941 Walter immigrated to Canada and settled in Toronto enlisting in the Canadian army. After the war he realized that 35mm cameras would soon be the rage and started a business with practically no funding. He scraped by until in 1949 he contracted with Olympus in Japan to distribute 35mm cameras and related optical products. He spent a great deal of time seeking marketing rights throughout Europe for microscopes, telescopes, fiber-optic devices and binoculars. Within twelve years his company was doing 10 million plus in annual sales.

Walter sold his company in 1962 to Charvoz-Carson. The company's focus was refined as a distributor of optical, audio, drafting and engineering equipment. The company also offered art supplies.

In 1986 Charvoz-Carson acquired Stendig Industries, Inc. diversifying even further. Stendig Industries was a manufacturer and importer of residential and contract furniture. In an attempt to focus even more on furniture Charvoz-Cason changed its name to Stendig Industries and bought several other furniture related businesses. While their revenues had doubled in 5 years to 52 million, the extreme diversification and lack of focus proved to be unprofitable and in 1988 began an effort to reorganize and hired a new CEO, James P. Reilly.

Reilly began selling businesses and reshaping the company's focus. Because the company's most valuable asset was the distribution agreement with Olympus Optical Co, Reilly decided to focus on medical products. And while this refocus included microscopes their primary focus was on endoscopes. The company did in fact continue to distribute Olympus cameras however throughout the 1990s.

In 1989 Stendig Industries became Cantel Industries.

The company has purchased many companies throughout its history. Some of those companies are; Medivators, Crosstex, Mar Cor Purification, Minntech Corporation Saf-T-Pak, Aexis Medical (based in Belgium), Ashland, Dyped Medical B.V., Hu-Friedy, Skippack and The Biolab Group. We've included a brief summary and some of the main products for the more prominent acquisitions below.

With the acquisitions made prior to 2004 Cantel experienced a 31.5% increase in revenue and decided to seek even larger companies to target for acquisition. The primary revenue range of these targets would be at least 25 million. In 2005 Olympus pulled the plug on its $38 million a year contract mentioned in the "Cantel Origins" section above. This was a huge blow to its stock price cutting it almost in half. But the purchase of Crosstex International for 77.9 million helped the stock climb back relatively quickly.

Cantel continued acquisitions and refinement of their target industries and by 2005 their revenues were almost 200 million with a net income of 15.5 million.

The Minntech acquisition in 2001 was part of Cantel's strategy to bolster its strength in the infection control and medical device reprocessing market. Minntech has successfully focused on disinfection and reprocessing systems for renal dialysis as well as filtration. With the addition of Minntech Cantel's revenues doubled and considerably changed Cantel's mix of business. Prior to the acquisition, approximately 80% of its revenue stemmed from capital equipment sales and 20% from consumables. After the acquisition these percentages reversed making the company much more profitable.

Cantel also has a Canadian subsidiary, Carsen Group. Through this subsidiary Cantel markets and distributes medical related equipment and instruments as well as industrial equipment. An example of some of these products are flexible and rigid endoscopes, endoscope disinfection equipment and scientific equipment including image analysis hardware and software.

Medivators was purchased by Cantel on May 31^st, 2001 and more recently is going through the process of rebranding to Cantel. While the web site domain, medivators.com still exists, their web site indicates that "Medivators is now Cantel" and the logo is the "Cantel" logo.

At that time in 2001, information on Crunchbase.com gave the following as descriptions of each of the companies. The description helps to better understand where the companies were already vs where they are today.

• Medivators | Leader in developing, manufacturing, and marketing medical devices, sterilants and water purification products.
• Cantel Medical | Provider of infection prevention products and services for caregivers, patients and other healthcare providers.

Medivators focus has seemed to remain steadfast with regards to medical device reprocessing, products having to do with Endoscopy procedures and prevention of infection. Their Endoscopy division offers a large range of infection prevention solutions focusing on two main areas, endoscope reprocessing and endoscopy related procedure products.

Their procedure products include a number of reprocessing systems including:

• Advantage Plus™ - Pass-thru Automated Endoscope Reprocessor
• Advantage Plus™ - Endoscope Reprocessing System
• CER Optima™ - AER
• Rapidaer™ - Endoscope Reprocessor
• CER Series – Endoscope Reprocessor
• DSD EDGE™- Dual basin AER
• DSD-201LT – Dual basin AER
• SSD-102LT – Single basin AER
• And a number of UK approved AERs

Medivators absolutely covers a wide range of AER needs for high-level disinfection of endoscopes and their accessories. They have even developed solutions for small practices with very little space by offering countertop versions and larger practices that demand higher efficiency and throughput with dual basin versions capable of processing a number of endoscopes concurrently. Here is how they outline their AERs categorically.

• The CER series is focused on reliability and cost efficiency. It still results in time-savings and the performance is amazing considering the small footprint fitting on almost any table-top.
• The SSD series is a single basin model automated endoscopic reprocess that is well suited for smaller, low volume facilities.
• The DSD series is designed to handle larger volume facilities while keeping the cost-per-cycle at a minimum.
• The ADVANTAGE series is the highest-end solution incorporating full automation with computer based dual asynchronous reprocessing technologies.

The Crosstex International subsidiary of Cantel focuses on the dental market. They have U.S. facilities and also have a manufacturing facility in Japan, Netherlands and Argentina. They manufacture products such as facemasks and shields, disinfectants, barrier films, sanitizers, patient bibs and other cotton and gauze products. The dental market made a lot of sense as the next medical arena to add to their focus as dental practices have many of the same needs as medical offices with regards to the infection control market.

Mar Cor was acquired in 2003. They market themselves as the leading supplier of the world's best water filtration and purification systems. Having been in business for over 4 decades there's a good argument that they're correct. They've focused their business in the medical, commercial and industrial segments and not only supply water filtration systems but also offer disinfection products.

Some of their products include:

• Dialysis Water Treatment Systems
• oCentral Dialysis Water Systems
  Offering both basic and advanced systems compliant with AAMI standards for dialysis water and CMS requirements ensuring that hemodialysis clinics have the equipment, products and support needed.
• oPortable Dialysis Systems
  For home treatment of patients or in clinical settings that require portability. These RO (reverse osmosis) systems provide reliable production and full monitoring capabilities.
• oBicarbonate Mixing Systems
  These systems prepare a liquid sodium bicarbonate to make dialysate for hemodialysis patient therapies. Offerings include gravity fed and pressurized distribution loop.
• oWater Distribution Systems
  These units are for final filtration, delivery and disinfection strategies. The hollow fiber filters used remove endotoxins and pyrogens prior to dialysis machine use. Some of these system handle periodic heat disinfection and others rely on chemical processes maintain microbiological integrity of the distribution storage system.
• High Purity Water Systems
  Ready to go High Purity Water systems, products and services utilizing filtration and disinfection technology incorporating FIBERFLO™ Filters and MINNCARE™ Sterilant brands.
• Research Lab Systems
• Ultrapure Water Systems

Biolab Equipment Ltd. Was acquired on the same day as Mar Cor Purification in 2003. These two acquisitions further solidified Cantel's objective of being involved in the water treatment market. Founded in 1969, Biolab focused on "ultra-pure water" technologies for the medical, biotechnology, pharmaceutical and semi-conductor industries.

Skippack, founded in 1971 in Pennsylvania provided water treatment equipment design, project management, installation, maintenance, deionization and mixing systems.

Hu-Friedy focuses on dental products and has a comprehensive product portfolio some of which include solutions for Chairside management, Cleaning Solutions, Sterilization & Monitoring, Education, IP Consumables and Storage Tracking.

The acquisition of Dyped Medical B.V. strategically supported Minntech's technological strengths providing an endoscope disinfection system that was compliant with European regulations.

In 2004 Cantel acquired Saf-T-Pak with the strategy of becoming proficient with medical packaging and training. Saf-T-Pak focused on safely transporting blood, tissue and infectious materials. They were located in Canada and only had revenues of 5 million a year, but was an entry for Cantel into this market.