Siemens looks to expand molecular imaging business with CTI acquisition

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Siemens Medical Solutions late last week set into motion plans to acquire CTI Molecular Imaging Inc. and bring together under one umbrella all of the businesses that make up the Knoxville, Tenn.-based company, including: CTI PET Systems, PETNET Solutions, CTI Mirada Solutions, CTI Molecular Technologies and CTI Concorde Microsystems.
   
The transaction has a value of approximately $1 billion, Siemens said.
   
CTI Molecular Imaging was established in 1983, focusing on positron emission tomography (PET) and molecular imaging and later extended its business into research, development and the distribution of PET tracers and probes.
   
CTI PET Systems (CPS) was formed in 1987 as a joint venture between CTI and Siemens to combine CTI's expertise in PET technology with Siemens' global distribution network.
   
In FY04, CTI reported sales of $402 million and income from operations of $58 million.
   
Under the terms of the agreement, Siemens said it will commence a cash tender offer within 10 business days to acquire all of the outstanding shares of CTI stock at a price of $20.50 per share. Following the completion of the tender offer, any remaining shares of CTI stock will be acquired in a merger at the same price per share, Siemens said.
   
The Board of Directors of each company has approved the agreement.
   
Subject to customary regulatory approvals and other customary closing conditions, the transaction is expected to close in the second quarter of FY05.