Mindray commits $105M to grab U.S. ultrasound imaging company
Mindray Medical ($MR) will snatch up California-based Zonare Medical Systems for $105 million in cash and debt, giving China's largest devicemaker some crucial new imaging technology and another entry point into the lucrative U.S. market.
Once the deal is done in the third quarter this year, Zonare will keep its brand name and existing operation in Mountain View, CA. And the current management team, including president and CEO Timothy Marcotte, will remain in place.
The acquisition is a smart one for Mindray, which is trying to grow its imaging business into something more formidable. Execs clearly hope that Zonare's ultrasound business with a focus on the high-end radiology segment will help make this happen. Medical imaging generated $53.2 million in net sales for Mindray during its fiscal 2013 first quarter. But the revenue number is flat versus 2012, and Mindray's two other segments are both larger and growing. In vitro diagnostics revenue surpassed $68 million during the first quarter, up more than 20% year-over-year. And patient monitoring, at $99.4 million in net sales, represented a nearly 4% increase over 2012.
But Mindray doesn't just want Zonare's tech. Mindray co-CEO Minghe Cheng said in a statement that the company sees opportunity in tapping into its R&D landscape and its direct sales and service network, as well as its place in the high-end ultrasound market. Zonare, launched in 1999, generated $64 million in revenue in 2012. And the company's direct sales team already has a wide focus, the companies note, in the U.S., Canada, Scandinavia and Germany.
Of course, Zonare gets something from the deal as well--backing of a major device player that can help accelerate its global market rollout.
Marcotte, in a statement, said he sees the M&A deal as creating "a global ultrasound company that is better positioned to serve the healthcare market on a worldwide basis."
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