Kodak Health Group sold to Canadian buyer

Eastman Kodak announced today that it has agreed to sell the Kodak Health Group, which includes its medical imaging and healthcare software business, to Onex Healthcare Holdings in a deal worth up to $2.55 billion (£1.31 billion).

Onex is one of Canada’s largest corporations; it describes itself as a diversified company with global operations in service, manufacturing and technology industries.

The price is composed of $2.35 billion in cash at closing, plus up to $200m in additional future payments if Onex achieves certain returns.

Kodak’s Health Group has a strong footprint in UK healthcare. It was chosen last year year to supply PACS/RIS for BUPA’s hospitals and also secured an NHS Scotland-wide deal for its PACS and information management solution in 2005.

The group has about 8,100 employees worldwide whose employment will continue with the group at closure of the sale. Around 1,000 of those employees are in Europe with 150 based in the UK and Ireland.

Eastman Kodak announced last May that it had started examining options for finding a partner to share its highly successful healthcare group or for divestment.

Commenting on the deal announced today Kevin J. Hobert, president of Kodak’s Health Group: “Onex has a long track record of acquiring businesses and working with them to achieve superior growth and operational excellence. Onex’s expertise and its commitment to this business, together with the health group’s proven product portfolio, worldwide presence and highly talented employee base will result in tremendous opportunities to provide the best in customer service.”

In a webcast following the announcement, E-Health Insider asked Hobert about the impact of the deal on European customers. He replied: "It’s only positive. There’s not a specific impact in one region of the world."

He added: "We’ve won some very significant projects and contracts in Europe, some of those customers expressed concern that may not be able to serve them on 10 year contracts, so [we] should allay those concerns."

Antonio M. Perez, Kodak’s chairman and chief executive, added “Onex is an ideal acquirer of Kodak’s Health Group because they understand the health industry and are committed to growing the business for the benefit of customers and employees.”

Robert M Le Blanc, an Onex managing director, commented: “This is a great opportunity to acquire and grow a business that has established an extraordinary record in delivering innovative solutions to customers around the world. We are very impressed with the health group’s world-class products in every sector: medical, dental, molecular imaging and non-destructive testing.”

He underlined Hobert’s assurances about European business.  "It’s a global business and we intend to keep it global," he said.