Eastman Kodak (NYSE: EK) is in advanced negotiations to acquire Israeli medical devices company Orex Computed Radiography for $55 million: $45 million in cash and $10 million in shares. Sources close to investors in Orex said that the deal would be confirmed in the near future.
Orex said in response that it was negotiating, but that no acquisition deal had been signed.
The current deal is not Eastman Kodak’s first acquisition in Israel. A year ago, it acquired Algotec Systems for $42 million, and in early 2004, it acquired RealTimeImage for an estimated $20-30 million. Eastman Kodak acquired Israeli company Picture Vision in 2000 for $90 million, but closed down its activity in Israel eighteen months later.
Founded nine years ago, Orex has undergone many changes. The company encountered crisis four years ago, following which its investors and management decided to change its strategic direction. The decision now appears successful.
Orex develops compact digital medical and dental x-ray systems. Orex’s system provides an immediate diagnosis of x-rays at far lower cost than current systems. Orex’s system does not use film or chemical materials. Another advantage of Orex’s system is its ability to distribute the x-ray, which facilitates remote diagnosis.
The system is suitable for a wide variety of medical applications, e.g. orthopedics, mammography, bone density, and radiotherapy.
Orex’s development center has always been located in Yokne’am, with additional centers in Boston and Brussels. Previous reports said that the company had doubled its revenue every year, reaching $20 million in 2003.
Orex has raised $11.6 million to date in three financing rounds. Cukierman and Co. subsidiary Catalyst Fund LP is the largest shareholder in Orex, having invested $3 million in the company. According to Israel Venture Capital figures, Catalyst owns 25% of Orex. Other shareholders include Dor Ventures, Medica Venture Partners, HB Investments, First Isratech Fund, and Atara Technology Ventures.
Investors in Orex are expected to earn 4-5 times their investment.
Published by Globes [online], Israel business news - www.globes.co.il - on December 19, 2004