Colorado MEDtech to acquire Civco Medical Instruments

Deal broadens firm’s reach into ultrasound products

Imaging OEM component provider Colorado MEDtech moved to expand its product line this month when it signed a letter of intent to purchase Civco Medical Instruments, an ultrasound products firm. The Boulder, CO, company expects Civco to complement its existing businesses, including its Imaging and Power Systems division, which designs and develops MRI components and systems for OEMs, and its CMED Catheter and Disposables Technology unit.

The stock-for-stock transaction should close within the next few months, pending due diligence, according to Colorado MEDtech. Financial terms of the deal were not disclosed.

Colorado MEDtech was established in 1992 with the merger of two firms: RELA, a custom product development and manufacturing company, and Cybermedic, a developer and manufacturer of computerized cardiopulmonary equipment. The company is primarily an OEM supplier. Colorado MEDtech designs, develops, and produces in vitro diagnostic systems, MRI and CRT systems, and electromechanical assemblies and software for ultrasound, MRI, CT, x-ray, and nuclear medicine systems. The company also manufactures such proprietary products as MRI amplifiers and power supplies, as well as respiratory oxygen support systems.

Also an OEM supplier, privately held Civco manufactures ultrasound transducer covers and biopsy needle guides. The Kalona, IA, company was founded in 1981 and boasts a distribution network of 35 sites worldwide. Civco has annual revenues of $10 million.

Colorado MEDtech has been on the acquisition trail since early this year. In February, the company purchased Eclipse Automation, and in August, x-ray generator subsystem manufacturer Creos Technologies of Englewood, CO, in a $2 million deal. Creos was integrated into Colorado MEDtech’s Imaging and Power Systems division (SCAN 9/15/99).

The Civco acquisition is part of Colorado MEDtech’s larger strategy to expand its product reach, according to John Atanasoff, president and CEO. By adding Civco to its ranks, Colorado MEDtech expects to strengthen its position in the outsourcing sector.

“We’re in a $3 billion outsourcing market, and we want to become the performance leader,” Atanasoff said. “We expect to do this by growing our base technical business and by making appropriate strategic acquisitions. We’re exploring partnerships with companies that have the same customer base, as well as some technological advantage to offer.”

Colorado MEDtech plans to integrate Civco into its business once the transaction is complete, although Civco will remain at its Kalona headquarters. The company anticipates that it will retain Civco’s approximately 95 employees.