CardioNet to buy cardiac testing lab for $23.5M

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CardioNet, a wireless medical technology company with a focus on the diagnosis and monitoring of cardiac arrhythmias, has entered into a definitive merger agreement with cardioCORE Lab, a centralized cardiac testing laboratory with locations near Washington, D.C., San Francisco and London.

The total consideration to be paid by CardioNet will be $23.5 million. At its option, Conshohocken, Pa.-based CardioNet may pay up to $3.5 million of the total consideration in the form of common stock. The transaction, subject to customary closing conditions, is expected to close in this year's third quarter.

"[T]his acquisition goes a long way in mitigating some of our revenue concentration and reimbursement risk," Joseph Capper, president and CEO of CardioNet, said in a statement.

cardioCORE is expected to generate $19 million to $20 million in revenue and $3.5 million to $4 million in EBITDA for the full year 2012, according to the companies. CardioNet will provide additional information about the expected financial impact of the transaction on its second half results during its earnings conference call scheduled for Aug. 8.

In a different attempt to diversify its portfolio, CardioNet purchased ECG Scanning & Medical Services for approximately $6 million earlier this year.