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Mercury Computer Systems seeks to acquire Germany PACS supplier


Mercury Computer Systems is making a bid for the German software development firm Sohard, which supplies PACS through OEMs as well as distributors and dealers. The two companies have signed an agreement detailing the acquisition, pegged at 19 million euros ($23 million).

Mercury Computer Systems is making a bid for the German software development firm Sohard, which supplies PACS through OEMs as well as distributors and dealers. The two companies have signed an agreement detailing the acquisition, pegged at €19 million ($23 million).

Mercury executives expect the deal to close in the third quarter of 2005. Sohard generates about €8.3 million ($10 million) in annual revenues and is "modestly profitable," according to Mercury.

The Chelmsford, MA, firm has long been a supplier of advanced electronics and software to vendors of medical imaging equipment. Lately it has been branching out, developing and marketing to OEMs software and software-hardware combinations that perform critical functions in diagnostic and interventional products as well as PACS (DI SCAN 3/7/05). The acquisition of Sohard is expected to go a long way toward strengthening this effort.

Executives at Mercury expect the image distribution and archive software in the Sohard portfolio to complement Mercury capabilities in scanner control, reconstruction, acceleration, and advanced 3D visualization. Integrating these technologies should help the company sell Web-based PACS as well as other scanner components to OEMs, said Marcelo G. Lima, Mercury vice president of life sciences and of commercial imaging and visualization solutions.

Sohard claims more than 950 installations of its Web-based PACS products and more than 50,000 users of its software applications worldwide. Applications range beyond PACS to include professional services involving software intelligence. The company also makes hardware and firmware for commercial embedded systems.

Many of the PACS installations were sold through or relabeled by other vendors. The company supplies Siemens with MagicWeb, a Web-based PACS. Sohard also provides PACS to Ferrania and Rogan, while selling its Radin PACS through dealers and distributors. Mercury will honor arrangements previously made by Sohard, according to Lima, emphasizing those that align with its own approach of selling to OEMs.

"We are very OEM-focused," he said. "We want to sell to OEMs and customize the solutions to their needs."

If the deal to acquire Sohard goes through, Mercury might also take advantage of the German firm's professional services. The privately held company, whose 85 employees are based in Fuerth near Nuremberg, operates an "intelligence unit" that Mercury describes as steeped in Microsoft.net domain and implementation knowledge.

This capability was one of the strengths that attracted Mercury, which became interested in acquiring Sohard earlier this year. The two companies first interacted after the German firm contracted with Mercury last October for hardware and software to boost the power of its Radin PACS.

Sohard signed up for two types of Mercury products. The XBi is a modular and scalable workstation that offers advanced processing capabilities, wide bandwidth, 3D graphics, and acceleration options. The Mercury Visage RT software provides advanced 3D imaging for digital modalities.

As Lima learned more about Sohard, he became interested in the company less as a customer and more as an acquisition.

"Our XBi server needed more image distribution capabilities," he said. "Sohard Web-based PACS brings that because it has all the DICOM and HL7 links that we require, plus the data management infrastructure and data distribution infrastructure that we can layer over our visualization and reconstruction technologies."

Mercury is aggressively pursuing opportunities in networking and advanced visualization. Over the last six months, the company has unveiled several new offerings. These fall into two categories: turnkey systems and embedded components. Both are designed for use by OEMs.

The turnkey systems - workstations and software libraries that are part of Mercury's ExamineRT family - run on stand-alone computing platforms, as well as scalable application servers that can be connected to multiple thin clients. For optimal performance, ExamineRT can be teamed with Mercury's XB series of modular and scalable workstations, which make use of multiple processors and acceleration boards. (XBi is the first in this family of workstations.) These products use off-the-shelf hardware enhanced by accelerators developed by Mercury and its strategic partner NVIDIA, a developer of graphics and digital media processors.

The embedded products bolster the power of existing OEM imaging systems. These software products, members of the VisageRT family, provide advanced 3D imaging for such modalities as CT, MR, ultrasound, digital x-ray, molecular imaging, and breast tomosynthesis.

Lima plans to leverage the Sohard technology to deliver 3D and 4D images through scanners, servers, and the Web. The image distribution technology will also play a part in Mercury's efforts to capitalize on 3D and 4D opportunities in interventional imaging.

"I don't believe the future stands in separate 3D workstations," he said. "This type of processing today is an afterthought. I think integrated 3D will be demanded by radiologists, cardiologists, and interventionalists."

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