(Adds comment from Steris, details on ruling, updates shareprice)
By Diane Bartz
WASHINGTON, Sept 24 (Reuters) - A federal court in Ohiorefused on Thursday to stop a $1.9 billion purchase by U.S.medical technology provider Steris Corp of Britishsterilization services provider Synergy Health Plc,despite the objections of U.S. antitrust enforcers.
The Federal Trade Commission filed a lawsuit in May aimed atstopping the deal, saying it would hurt customers by eliminatinglikely future competition based on new sterilization techniques.
Steris' share price rose on the decision. It was up 6.3percent for the day at $66.89 after the decision was announced.The company said it anticipated closing the transaction beforethe end of the year.
The FTC argued that the deal broke antitrust law becauseSynergy had scrapped its plans to enter the U.S. market and open U.S. plants that would use x-ray to sterilize medical devices.Synergy's plants, the FTC said, would have competed with Sterisplants that use gamma rays for the sterilization process.
The FTC had asked the court to temporarily stop thetransaction from closing while it considered the deal in anadministrative court at the agency. Delays in FTC internalproceedings generally end in the deal falling apart.
Steris and Synergy, for their part, argued that Synergydecided to scrap the expansion into x-ray in the United Statesbecause it found few customers interested in signing up.
The Ohio court agreed.
The FTC failed to show "by a preponderance of evidence" thatit was likely to succeed on the merits of the case, said JudgeDan Polster in denying the FTC request to temporarily stop thedeal.
Steris announced the transaction in October, saying itwanted to expand its footprint in Europe. The plan is forCleveland-based Steris to buy out UK-based Synergy Health, withthe combined company managed from Ohio but incorporated inBritain. Such "inversion deals" can allow U.S. companies to getlower tax rates by reincorporating overseas.
"We are pleased with the court's decision and we will workto expeditiously close the acquisition of Synergy Health," WaltRosebrough, president and CEO of Steris Corp, said in an emailedstatement.
Both Steris and Synergy have shareholder votes on thetransaction set for Oct. 2. Synergy and Steris recently extendedthe deadline to complete the deal to Dec. 31.
The FTC had no comment. (Reporting by Diane Bartz; Editing by Eric Walsh and FrancesKerry)
