PALO ALTO, Calif--Oct. 13, 2003--Varian Medical Systems, Inc. (NYSE: VAR - News) today announced anagreement to acquire Zmed, Inc., a privately-held and rapidly-growing supplier of radiation oncology software and accessories for ultrasound-based, image-guided radiotherapy (IGRT), stereotactic radiation treatments, and image management. Varian Medical Systems will pay approximately $35.5 million in cash for the business, subject to certain adjustments. "This acquisition will add elegant 3D ultrasound imaging capabilities to Varian Medical Systems' image-guided radiotherapy products," said Dick Levy, CEO and Chairman of Varian Medical Systems. "It also makes it possible for Varian to offer radiation oncology departments a new line of stereotactic positioning accessories and planning software for treating patients with ultra-precise, hypofractionated radiotherapy or radiosurgery. We are continuing to enhance the versatility and capability of Varian's integrated radiation oncology system." The acquisition also includes Zmed's line of servers and software for storing, accessing, transferring and reviewing patients' diagnostic images among medical professionals and support staff via local networks and the Internet. "We expect this to be a significant enhancement to the image management function, particularly within our VARiS Vision software product," Levy said. Varian expects the acquisition will add annualized revenues of $16 million to $18 million in the first year and be neutral to slightly accretive to earnings for the company. "We are hopeful that our worldwide sales and service network will lead to faster adoption of Zmed's already successful products and technology," said Levy. Zmed revenues have grown at about 60 percent per year for each of the last three years. It has systems at more than 110 customer sites. "Becoming part of Varian Medical Systems, enables us to integrate Zmed technology into the world's most comprehensive radiation oncology systems," said Marc Buntaine, president and CEO of Zmed. "We are extending our reach through a global sales and service network so that we can make better technology available to more patients sooner. I can't see a faster or better way to commercialize our technology." Zmed and its approximately 30 employees will continue to operate from its base near Boston, Massachusetts under the direction of Buntaine. It will be a part of Varian's Oncology Systems' business segment. The transaction is expected to be closed by the middle of November and is not subject to any pre-closing regulatory filings.
Varian Medical Systems to Acquire Zmed, Inc.
Corporate and Financial Releases
October 13, 2003