Healthcare Business News

Steris to acquire surgical instrument repair company for $165 million

By Chuck Soder, Crain's Cleveland Business
Posted: April 1, 2014 - 1:30 pm ET

Steris Corp., Mentor, Ohio, plans to spend $165 million to acquire an Alabama company that repairs surgical instruments and provides related consulting services.

The acquisition of Integrated Medical Systems International is part of Steris' plan to expand its specialty services line of business, which repairs medical devices, in addition to providing other services.

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Steris, which makes medical equipment, expects the market for Integrated Medical Systems' services to grow. The Birmingham, Ala.-based company operates in a fragmented business. Surgical instrument repair, endoscope repair and other consulting services related to equipment sterilization are offered by a variety of companies, and many hospitals do the work themselves, according to a news release from Steris.

Sales at Integrated Medical Systems are expected to be in the $150 million range in 2014. The deal is expected to add about $15 million in annual operating income to Steris' balance sheet during a full fiscal year.

The deal is expected to close by June 30.

In addition to the $165 million acquisition, Steris expects to spend another $10 million on real estate as part of the deal.

The purchase price effectively should be reduced to about $140 million, Steris said, because it expects to receive tax deductions on the goodwill and intangible assets purchased.

"Steris to acquire surgical instrument repair company for $165 million" originally appeared on the Crain's Cleveland Business website.

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