Kodak Health Group sold in $2.55 billion deal
Eastman Kodak Company has announced the sale of its Healthcare Group to Toronto-based Onex Healthcare Holdings, Inc. in a deal valued at up to US$2.55 billion (€1.95 billion).
The acquisition will add to Onex Healthcare’s operations, which include emergency care facilities and diagnostic imaging clinics. Onex Healthcare is a subsidiary of Onex Corporation, a major buyout firm.
Known for its CareStream picture archiving and communication system PACS and radiology information systems RIS, U.S.-based Kodak Health Group is a world leader in healthcare information technology products and services.
The acquisition will add to Onex Healthcare's operations, which include emergency care facilities and diagnostic imaging clinics. Onex Healthcare is a subsidiary of Onex Corporation, a major buyout firm.
In a Jan. 10 webcast, Kodak Health Group President Kevin Hobert said that the acquisition will affect the company's employees and activities in Europe "only positively." He added, "There is not a specific impact on one part of the world over another. We compete globally and we intend to keep it global."
The new group will retain its management but will not be called Kodak, Hobert noted.
Robert M. Le Blanc, a managing director for Onex, said that the acquisition will allow Onex Healthcare to reach its full potential. "Our investment dollars will go into developing new products," he said.
Both Hobert and Le Blanc stressed that Onex's current healthcare companies operate on the provider side of the industry. "This isn't a situation where you have a company that's in the same industry trying to rationalize a new portfolio," said Hobert.
Citing declines in earnings and digital sales, Kodak announced last May its interest in selling the Health Group. Antonio M. Perez, Kodak chairman and chief executive officer said in May, "While the Health Group is enjoying strong organic growth in elements of its digital portfolio, such as digital capture solutions and healthcare information solutions, we have been observing for some time consolidation in this industry. Given our valuable assets and the changing market landscape, we feel that now is the time to investigate strategic alternatives."
Hobert said that some European customers had "expressed concerns" last May, but that the announcement of the sale should both allay concerns and excite Kodak's European stakeholders.
In the company's announcement of the deal with Onex, Perez said, "We now plan to focus our attention on the significant digital growth opportunities within our business in consumer and professional imaging and graphic communications."
Robert M. Le Blanc, managing director of Onex, said his company was impressed by the Health Group's products in medical, dental, molecular imaging and non-destructive testing. "We recognize that growth is critical and that digital technology is the future," he added.