• AI
  • Molecular Imaging
  • CT
  • X-Ray
  • Ultrasound
  • MRI
  • Facility Management
  • Mammography

Primedex moves to acquire Radiologix

Article

Primedix Health Systems has signed a definitive merger agreement to acquire Radiologix. If the deal, valued at $208 million (including net debt) goes through, it will create the largest owner and operator of fixed-site outpatient imaging centers in the U.S. with 132 locations. Primedex owns and operates 62 facilities. Radiologix owns or operates 70.

Primedix Health Systems has signed a definitive merger agreement to acquire Radiologix. If the deal, valued at $208 million (including net debt) goes through, it will create the largest owner and operator of fixed-site outpatient imaging centers in the U.S. with 132 locations. Primedex owns and operates 62 facilities. Radiologix owns or operates 70.

After the deal was announced, the share prices of both companies rose. Primedix stock advanced 35¢ to $2.10 per share but eased back to about $1.90 when the market closed. Radiologix stock jumped more than a dollar to $3.44, then gave up ground to about $3.10 at the close.

The combination stock and cash deal has been approved by both companies' boards of directors but remains subject to customary conditions, including shareholder approval and antitrust clearance. The transaction, expected to close in the second half of 2006, will be financed by GE Healthcare Financial Services, which has committed $405 million of senior debt financing to Primedex. A $45 million revolving credit facility will be used for working capital and general corporate purposes. The remaining $360 million will fund the cash purchase price of Radiologix and refinance substantially all the existing debt of both companies.

The acquisition of Radiologix, a national provider of imaging services headquartered in Dallas, allows Primedex to expand its presence in California and grow in key markets across the U.S. The merged company would run 80 imaging centers in California, 32 in Maryland, 12 in New York, and eight in other states, including Florida, Kansas, Colorado, and Minnesota.

After closing the transaction, Primedex will generate more than $400 million in annual revenues. An initial $11 million of near-term synergies have been identified, which will be executed during the 12-month period after the transaction closes.

If the deal goes through, Sami Abbasi, current CEO of Radiologix, will become vice chairman of Radnet, the new name of the merged companies. Howard Berger, chairman and CEO of Primedex, will hold these titles at Radnet. After closing the transaction, Radnet plans to submit an application to be listed on the American Stock Exchange, where Radiologix currently trades. Primedix trades on the OTC bulletin board.

Related Videos
Nina Kottler, MD, MS
The Executive Order on AI: Promising Development for Radiology or ‘HIPAA for AI’?
Related Content
© 2024 MJH Life Sciences

All rights reserved.