TomTec executives complete buyout of 3-D assets with Medison's backing

TomTec plans to remain independent

A group of TomTec executives last month successfully completed their management buyout of the 3-D/4-D assets of the company, which had gone out of business in June. In reporting the successful reorganization, the executives revealed that the funding for the buyout came from Korean ultrasound company Medison and its Kretztechnik subsidiary. The loan was combined with an option for Medison/Kretz to acquire TomTec shares in 1999.

Even if Medison/Kretz does convert the loan into stock, however, TomTec will remain an independent company, and will continue to work with other ultrasound companies, according to Frank Schlau, senior vice president for sales and marketing. TomTec has mutual development agreements with all major ultrasound companies and will continue to concentrate on its OEM business. The Munich-based vendor will also continue with its own worldwide distribution channels, said Schlau, who along with Ulrich Haupt and Bernhard Mumm owns 33.3% of TomTec shares.

The three owners of TomTec accepted the loan from Medison/Kretz due to that company's belief in 3-D ultrasound. Also, unlike venture capital companies, Medison/Kretz did not demand a return on investment, Schlau said.

"They leave us as an independent company and they had the best offer," he said,"TomTec and Medison/Kretz will cooperate like OEM partners, but they will not distribute TomTec products under the TomTec name."

All of TomTec's current products, including Echo-Scan, Echo-View, and Compact 3-D, will be continued, according to the company. TomTec will also handle the production, marketing, and support of TomTec's P90 and P2000 stress-echo systems outside of the U.S. and Canada.

One of TomTec's top priorities is to transfer its software platform to Windows NT. The vendor is developing clinical applications packages (CAPs) designed to answer specific clinical questions in cardiology, ob/gyn, and radiology. Its Windows NT-based CAPs for cardiology and general imaging will be released in time for the American College of Cardiology and American Institute of Ultrasound in Medicine meetings in 1998. The company guarantees a future upgrade path for all installed systems.

As for its previous stress-echo or digital networking business, TomTec has no plans to continue product development of these technologies. Instead, TomTec is partnering with another German company, Individual Software, which will provide TomTec with stress-echo and digital networking products to run on the company's new Windows NT platform, Schlau said.

TomTec's predecessor, TomTec Imaging Systems, was originally formed in early 1994 with the merger of ultrasound 3-D/4-D firm Tomographic Technologies and 2-D stress-echo and digital networking provider Prism Imaging/Freeland Systems (SCAN 1/19/94). Based in Boulder, CO, TomTec Imaging Systems never lived up to expectations and went into liquidation at the end of May (SCAN 6/11/97). In the U.S., Boulder, CO-based CraMar Technologies will continue support of TomTec's stress-echo and networking products, Schlau said.