Baby test maker Natus Medical Inc. of San Carlos, CA will buy NeuroCom International Inc. of Clackamas, OR for $18 million.
NeuroCom, which sells tests used in measuring and treating mobility and balance disorders, had sales of $11.3 million in the year ended June 30. It should have $3.4 million in cash after the deal is done, probably in early October.
Natus, led by CEO Jim Hawkins, is paying cash in this deal.
Natus is consolidating different businesses (gained through a variety of acquisitions) into three locations -- Oakville, Ontario, Canada; Mundelein, IL.; and Seattle, WA. Layoffs are also part of the plan.
Natus bought Waltham, MA-based Sonamed in May and the neurology business of Munich, Germany-based Schwarzer GmbH in July.
Natus makes products to test the hearing and neurological function of newborn babies, to test them for sleep disorders, and also products to cool the heads of babies with certain brain disorders. It makes light-emitting devices to treat newborn jaundice, and it also sells scales for weighing babies and other disposable medical products.
Hearing tests still supply most of the company’s revenue -- 53% in 2007, down from 61% in 2006 and 77% in 2005.
In the past, the company has grown via acquisitions, and has sometimes gambled a lot on them. To buy Canadian company Xltek in late 2007, Natus used “virtually all” of its available cash and went into debt for part of the $64 million purchase price. This forced the company to rely more on cash flow from its operations.
SOURCE: San Francisco Business Journal