Elbit marches on acquisition warpath with Ausonics purchase

August 15, 1994

Israeli firm forming umbrella ultrasound companyElscint parent Elbit has big plans for ultrasound, and it doesnot intend to stop with its purchase of Diasonics. Elbit revealedlast week that it has added to its Diasonics acquisition withthe

Israeli firm forming umbrella ultrasound company

Elscint parent Elbit has big plans for ultrasound, and it doesnot intend to stop with its purchase of Diasonics. Elbit revealedlast week that it has added to its Diasonics acquisition withthe purchase of Australian vendor Ausonics.

Elbit intends to merge Diasonics, Ausonics and Elscint's Elscintecultrasound subsidiary under a single umbrella unit with a fullrange of products, according to Jackob (Kobi) Vortman, sales managerof Elscintec. Elbit has not yet decided on a name for the unitit is building, but retaining the Diasonics label is one possibility,Vortman said.

"Ausonics was purchased as part of a strategy to buildan ultrasound company that will eventually cover a wide spectrumof products and capabilities," Vortman told SCAN. "Theintention is to cross-fertilize all these organizations usingtechnology know-how developed in each of them."

Elbit last month announced its plan to buy Diasonics in aneffort to build its medical imaging subsidiary's presence in ultrasound,which until now had been minimal (SCAN 7/27/94). Elbit boughtAusonics from the vendor's parent firm, Pacific Dunlop, a $4.5billion Australian conglomerate. The purchase was completed inMay, but Elbit delayed an announcement of the acquisition untilthe Diasonics deal was finalized, Vortman said.

Ausonics markets Opus 1, a low-end portable ultrasound scanner.It is awaiting Food and Drug Administration 510(k) clearance forOpus 2, also a portable black-and-white scanner. Ausonics introducedthe unit at last year's Radiological Society of North Americameeting. The scanner is intended for general radiology, ob/gynand urology applications.

Ausonics scanners are currently offered through a dealer network.Elbit will probably expand that network rather than build a directsales effort for the products. Ausonics sells about 200 systemsa year and has an installed base of several thousand.

Acquiring Ausonics gives Elbit a lower mid-range scanner tocomplement the premium VST Masters Series offering from Diasonicsand Elscintec's mid-range ESI 5000 scanner. The ESI 5000 is beingmodified with technology acquired from the Diasonics purchase,Vortman said.

Elbit is making a determined push in ultrasound because thecompany wants to focus on medical imaging, and ultrasound is thelargest imaging modality. Ultrasound's share of the imaging pieis likely to grow even larger in the future, according to Vortman.

"From a strategic point of view, we believe that the medicalimaging market will remain a major market with a definite focuson high technology," Vortman said. "There was a strategicdecision to go in and try to build a real (ultrasound) capability."