Image Data shareholders give nod to acquisition by E-Systems

E-Med to be headed by Image Data's Karlak The shareholders ofteleradiology vendor Image Data this month approved a plan tosell their company to E-Systems, the parent of picture archivingand communications firm Advanced Video Products (SCAN 10/26/94).The action finalizes the deal between the companies, accordingto Image Data president James Karlak.

The companies declined to state the terms of the acquisition,but an article in the San Antonio Business Journal reported thepurchase price to be $6.5 million. Image Data will be incorporatedinto E-Systems Medical Electronics (E-Med), the subsidiary E-Systemsformed to hold its medical acquisitions. E-Med will be headquarteredin San Antonio and Karlak will head the company, he told SCAN.Because of the short notice of the acquisition, AVP and ImageData will have separate booths at next week's Radiological Societyof North America meeting.

One of the first orders of business for Karlak will be to integratethe product lines of Image Data and AVP. The two firms combinedare the largest single teleradiology vendor by market share, butthere is some overlap between Image Data's MultiView productsand AVP's teleradiology offerings. Both firms have also been expandingtheir presence in the PACS market, with AVP developing a new Unix-basedversion of its PACS software and Image Data developing a DICOM3.0-compliant miniPACS image management network based on IBM'sRS/6000 workstation.

At the RSNA show, Image Data will display AVP's Megascan monitors,which have already been integrated into Image Data's product line,Karlak said. AVP may display Image Data's MultiView technologyintegrated with its PACS.

Karlak will also have his hands full assuaging Image Data'sco-marketing partners, which include Eastman Kodak, Du Pont andCemax. Image Data provides teleradiology links to these companies,which compete with AVP in the PACS market. Karlak said he is inongoing discussions with Image Data's partners and believes thatconflicts should be minimal.

E-Systems' plan to acquire Image Data is the latest move inan aggressive plan by the Dallas-based company to reposition itselfin the PACS arena. E-Systems laid off 13 workers from AVP in September,and bought two archival firms last month (SCAN 9/28/94 and 10/12/94).

The PACS industry's rumor mill has kept busy for the past severalmonths with speculation that E-Systems was planning to sell AVP.AVP has not performed as well as expected since E-Systems boughtthe company in 1992 (SCAN 11/4/92). Those rumors should be quelledby the Image Data acquisition, however.

Throughout the past six weeks of corporate activity, E-Systemsofficials have stressed that the company is firmly committed tothe medical imaging field, a sentiment that is echoed by Karlak.

"The one (rumor) I can dispel is their (alleged) attemptto pretty up AVP and then sell it out," Karlak said. "Wehaven't had any conversations like that. They know that the medicalimaging industry is a place where they ought to be able to leveragetheir systems' integration abilities and large image archivingsystems developed for the government and utilize those in commercialapplications."