Hologic completes acquisition of DRC

June 23, 1999

Bone densitometer firm Hologic has completed its purchase of Direct Radiography Corp. from SDI Holding, the parent company of Agfa subsidiary Sterling Diagnostic Imaging. The deal was valued at around $20 million, consisting of $7 million in cash

Bone densitometer firm Hologic has completed its purchase of Direct Radiography Corp. from SDI Holding, the parent company of Agfa subsidiary Sterling Diagnostic Imaging. The deal was valued at around $20 million, consisting of $7 million in cash and about 1.9 million shares of Hologic common stock. The purchase amount decreased sharply from the initial agreement, which was valued at about $30 million. Hologic was able to get some price concessions in exchange for a speedy closing, said David Ellenbogen, Hologic chairman and CEO.

As a result of the acquisition, Hologic receives about 90 employees, a 168,000-square-foot research, development, manufacturing, and administrative site in Newark, DE, 26 U.S. patents, and a number of foreign patents.

Hologic plans to market DRC’s DirectRay digital radiography technology via a number of channels, including OEM opportunities. Discussions with several potential OEM clients are under way, Ellenbogen said.

The company will also participate in the retrofit sector, equipping recently purchased traditional x-ray rooms with DirectRay detectors to pave the way for PACS, he said. In addition to the firm’s first retrofit site at Brooke Army Medical Center in Fort Sam Houston, TX, DRC has installed a retrofit at an undisclosed location. DRC is taking orders now for retrofits.

Finally, Bedford, MA-based Hologic will continue DRC’s direct sales efforts with its traditional iiRAD systems. In future development plans, Hologic expects to bring DirectRay technology suitable for fluoroscopy and mammography applications to market. Commercialization of these products will not occur for at least a year, however, Ellenbogen said.

© 1999 Miller Freeman, Inc.All rights reserved.