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NEW YORK, Sept 26 (Reuters) – Germany’s Sirona Dental Systems will take control of Schick Technologies Inc. (SCHK.OB: Quote, Profile, Research) in a $928 million stock deal to broaden its reach in the market for dental imaging technology, the companies said on Monday.

Schick, whose shares rose 6 percent in over-the-counter trading, will pay its shareholders a special dividend of $2.50 per share as part of the deal.

Sirona is a leading manufacturer of high-tech dental equipment; Schick is a leader in digital dental imaging systems.

“This transaction represents a significant strategic growth opportunity,” said Schick President and Chief Executive Jeffrey Slovin. “We will create a company with a strong global presence, an unrivaled breadth of products, and excellence in research and development.”

The merged company, to be named Sirona Dental Systems Inc., will be based in Bensheim, Germany, and will seek a Nasdaq National Market listing for its stock.

It will have $500 million in worldwide sales, including more than $180 million of revenue in North America, Schick said. The deal will boost 2006 earnings per share.

The companies expect to achieve annual combined cost savings of $5 million to $7 million within 12 to 24 months of the deal’s close.

In the deal, structured as a so-called reverse merger, Schick would issue to Sirona’s parent company 36.97 million new Schick shares. Sirona’s owners would hold 67 percent of the combined company, and Schick shareholders would own the balance.

Based on Schick’s closing stock price of $25.10 in Friday over-the-counter bulletin board trading, the value of shares to be issued in the deal is about $928 million.

Including more than $500 million in debt, the deal would have a total value of about $1.46 billion.

Schick shares were up $1.60 to $26.70 in late-morning trade on Monday.

UBS Investment Bank was exclusive financial adviser and Dorsey & Whitney LLP was legal adviser to Schick. JP Morgan was exclusive financial adviser and Kirkland & Ellis LLP was legal adviser to Sirona.

Sirona, which has offices in Germany and Charlotte, North Carolina, recently completed a management buyout with Madison Dearborn Partners LLC and Beecken Petty O’Keefe and Co., two private equity firms based in Chicago. (Additional reporting by Julie Steenhuysen in Chicago)