Philips has announced that it will acquire Volcano, a specialist in catheter-based imaging and measurement solutions for cardiovascular applications, for $1.2 billion. According to Philips, the transaction, which is expected to close in the first quarter of 2015, will allow the company to become a leader in the growing market of image-guided therapies.
In the last few years, Philips has created a successful image-guided therapy business and has developed a portfolio of interventional imaging equipment, navigation tools, and services, as well as a sizeable global customer base, including each of the top 50 Heart Surgery and Cardiology hospitals in the United States.
These systems provide the visual maps that allow the clinician to guide thin, tube-shaped instruments called catheters through the body, to the area of interest and perform the minimally invasive treatment.
With 2013 sales of approximately USD 400 million, San Diego, California-based Volcano is a leader in catheter–based imaging and measurements for minimally invasive diagnostics and treatment of coronary artery disease and peripheral vascular disease.
In addition, the company possesses one of broadest product portfolio around these two technologies, a leading IP position and a nascent peripheral vascular therapeutics business that targets a segment with a double-digit growth rate.
According to Philips, combining the two companies will create new sources of recurring revenue streams and increase sales growth for Philips in the European image-guided therapy market worth €4 billion. The combination of Volcano’s proven clinical development and commercialisation capabilities with Philips’ next generation of imaging and measurement technologies, will allow Philips to introduce new solutions in higher growth segments, such as the minimally invasive treatment of heart rhythm disorders and structural heart diseases.
Upon completion of the transaction, the Volcano business and its 1,800 employees will be part of a new image-guided therapy business group within Philips, which will be led by Philips executive Bert van Meurs.
‘The agreement to acquire Volcano significantly advances our strategy to become the leading systems integrator in image-guided therapies,’ said Frans van Houten, CEO of Royal Philips. ‘Volcano’s impressive and unique product portfolio is highly complementary to our strong offering in live image-guidance solutions, creating an opportunity to accelerate the revenue growth for our image-guided therapy business to a high single-digit rate by 2017.’
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