Orbotech (Nasdaq: ORBK) today announced that it has signed an agreement to purchase the assets of Imarad Imaging Systems Ltd.
Imarad is a privately held Israeli company which develops and manufactures high-performance, solid state gamma radiation detectors based on its innovative cadmium zinc telluride (CZT) crystal-growth technology. These detectors will initially be used in the field of nuclear medicine.
Orbotech Medical Solutions Ltd. (OMS), a wholly-owned subsidiary of Orbotech, will acquire all the assets of Imarad for $7 million. In addition, subject to the achievement of agreed milestones, OMS will make payments to Imarad on sales through the end of 2008, up to a maximum of $26 million.
OMS also announced a new strategic alliance with diagnostic imaging products and services provider GE Healthcare, a $14 billion dollar unit of General Electric Company (GE). Through this agreement, GE Healthcare will become a preferred customer of OMS for solid state radiation detectors developed on the basis of the CZT technology.
Dr. S. Morry Blumenfeld, founding partner of MediTech Advisors LLC, an investment and advisory firm specializing in the global medical devices field and advisor to Orbotech in this transaction, said: "The CZT crystal growth technology which Orbotech has acquired is truly ground-breaking and enabling. We expect that it will become an important element in the field of nuclear medicine and anticipate that it will generate significant growth opportunities."
In the course of his 34 year career at General Electric, Dr. Blumenfeld served as chairman of the board of Elgems, a forerunner of GE's current nuclear medicine business, and helped lead the development of the key technologies of CT and MRI.
Orbotech co-president of business and strategy Rani Cohen said, "Imarad has developed a highly innovative, enabling solid-state detector technology which is capable of facilitating significant improvements in image quality and diagnostic capabilities, as well as substantial cost savings, over currently available, analog-based nuclear medicine imaging solutions. We believe that there is a very substantial growth potential for advanced technology solutions that surmount existing limitations and specifically address critical customer needs in the expanding area of medical imaging.
"For Orbotech, this transaction represents an important step in the implementation of our strategy of diversification into new growth areas for imaging technologies. We believe that the pursuit of this strategy, together with the current strength of Orbotech's traditional business, position the company well for both short and long term growth."
Published by Globes [online], Israel business news - www.globes.co.il - on Monday, March 21, 2005