Medical Devices major Opto Circuits has shelled out $70 million to acquire US-based Criticare Systems, a non-invasive medical devices manufacturer in April 2008. It borrowed $52 million to finance the overseas purchase.
On Tuesday, Opto chairman & MD Vinod Ramnani said: “The founders of the foreign company sold their stake early on and it was being run by a group of people who had no stake in the company. We saw the synergy and knew that we could integrate the company and take it forward.”
Criticare currently outsources the production of its products to Taiwan. Opto, however, plans to transfer production to its Bangalore facilities by June 2009. The company projects that this will add an additional 20% to the bottomline.
It also plans to reduce the design cycle time from three years to nine months, thus adding 25% to the topline. Opto Circuits has been on an acquisition spree in the last few years.
It acquired Eurocor, a German company, in 2006 and has another US subsidiary Mediaid. The combined product portfolio of the company covers invasive and non-invasive products like digital thermometers, sensors — for which they are the largest producers, probes, pulse oximeters, patient monitoring systems and catheters.
“The market for invasive products is $10 billion globally of which $5 billion is in the US alone. The non-invasive market is $2 billion worldwide. We are the largest producer in terms of sensors and also manufacture them for Philips and GE,” Bodapati Bhaskar, Opto’s CFO said. Opto has a market cap of over $776 million.
Source: Economic Times