Analogic Agrees to $1B Sale to PE Firm Altaris

The pioneer of computer tomography imaging cites "the increasingly competitive markets that we serve" in deciding to end its 50 years of independence.
Matthew HellerApril 11, 2018

After a lengthy review of strategic alternatives, medical-imaging company Analogic has decided to sell itself to private-equity firm Altaris Capital Partners for about $1.1 billion.

The deal will end the 50-year independence of a company that initially focused on making analog-to-digital and digital-to-analog converters before pioneering computer tomography (CT) imaging, a key technological advance in medicine. It has also developed CT systems for screening baggage in airports.

Altaris, which has a history of investing in makers of medical devices, imaging technologies, and diagnostic equipment, has offered to pay $84 per share for Analogic.

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The deal price represents a discount of 12% to Analogic’s Tuesday’s close but a 25% premium to the closing price on June 7, 2017, the day after the company announced its strategic review.

“Given the increasingly competitive markets that we serve, we have been focused on the need to achieve greater scale in order to generate sustained profitable growth,” Analogic Chairman Bernard Bailey said in a news release.

“As a result, the board initiated a review of strategic alternatives available to Analogic,” he said. “This 10-month, comprehensive process resulted in today’s transaction with Altaris that provides stockholders with immediate, substantial, and certain cash value.”

According to Analogic, the board also considered separating the company’s three business units and continuing to operate on a stand-alone basis, but ultimately determined the Altaris transaction “presents the best combination of certainty and value for stockholders.”

Altaris’ other recent investments include Clearwater Compliance, a provider of cyber risk management solutions to the healthcare industry; G&H Orthodontics; and Chemical Computing Group, a maker of molecular design software.

“Altaris has a broad portfolio of businesses with strong technology and domain expertise in Analogic’s end markets,” said Fred Parks, chief executive officer of Analogic. “Altaris is well positioned to enhance Analogic’s ability to deliver innovative product technology and service offerings to our customers.”

In extended trading Tuesday, Analogic shares fell more than 12% to $84.15, just above Altaris’ offer.