Transcend Services buys transcription company for $16.2 million

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Medical transcription services provider Transcend Services has agreed to buy Medical Dictation Services for $16.2 million.

The Atlanta-based company said the transaction will close on or about Aug. 31. Medical Dictation is headquartered in Gaithersburg, Md., and has approximately 450 employees. It had unaudited revenues of $13.7 million for its past fiscal year, which ended in March.

Transcend said it will pay $10.2 million in cash at the closing, less any debt assumed and plus or minus certain working capital and tax-related adjustments. A further $2 million payment will be made by Transcend after it receives the last two years of Medical Dictation’s fiscal years’ interim financial statements and audited financial statements. A $2 million note is also payable to the selling shareholder a year after closing, and the transaction price includes $2 million in Transcend common stock.