Private equity firm Providence Equity Partners in Providence, R.I., has entered into a definitive agreement to acquire all of the outstanding common stock of Virtual Radiologic (vRad), a developer of radiologist workflow technologies, for $17.25 per share in cash. The transaction is valued at approximately $294 million.

The Eden Prairie, Minn.-based vRad said its board of directors unanimously approved the agreement and recommends that shareholders vote in favor of the transaction.

The company said its co-founder and Chief Medical Officer Eduard Michel, MD, who owns 6 percent of its outstanding common shares, and Generation Partners, which owns 25.3 percent of its common shares, have executed voting agreements pursuant to which they have agreed to vote in favor of the transaction.

The transaction is expected to be completed in the third quarter, subject to customary closing conditions, and regulatory and shareholder approvals, according to vRad.

Upon completion, vRad will become a private company, wholly owned by Providence Equity Partners.

Goldman Sachs is serving as financial advisor and Oppenheimer Wolff & Donnelly is serving as legal counsel to Virtual Radiologic. Weil, Gotshal & Manges is serving as legal counsel to Providence Equity Partners.