General Electric Company (NYSE: GE) subsidiary GE Healthcare will acquire Orbotech Ltd. (Nasdaq: ORBK) subsidiary Orbotech Medical Systems Ltd. for $9 million in cash, and up to an additional $5 million depending on meeting milestones. The deal is due to close during the first quarter of 2011.
Orbotech Medical Systems develops and manufactures solid state gamma radiation detector modules composed of Cadmium Zinc Telluride (CZT) detectors for nuclear imaging applications. The company's customer include GE Healthcare, Royal Philips Electronics NV (NYSE: PHG; Euronext: PHIA), and Siemens AG (NYSE: SI; XETRA: SIE). GE acquired Orbotech Medical Systems in order to strengthen its position in the three-way rivalry.
Orbotech Medical Systems has 50 R&D employees, and outsources its other activities. The company's cardiology imaging technology provides extensive information on heart function.
As part of the deal, GE and Yavne-based Orbotech will settle their outstanding litigation, and release each other from all claims.
Orbotech also published its financial report for the third quarter of 2010 today. Revenue rose to $158.1 million for the third quarter of 2010 from $91.8 million for the corresponding quarter of 2009.
GAAP-based net profit was $16.1 million ($0.45 per share) for the third quarter compared with a GAAP-based net loss of $5.5 million for the corresponding quarter. Non-GAAP net profit rose to $22.9 million ($0.64 per share) for the third quarter from $2.3 million for the corresponding quarter. The third quarter GAAP results included a $1.5 million write-down on goodwill and intellectual property of Orbotech Medical Denmark A/S.
Orbotech's share closed at $9.75 on Friday, giving a market cap of $340 million.
Published by Globes [online], Israel business news - www.globes-online.com - on November 1, 2010
© Copyright of Globes Publisher Itonut (1983) Ltd. 2010