Scientific Magnetics – a UK-based business that designs, manufactures, tests and installs bespoke superconducting magnet systems – and its US subsidiary Tecmag, which manufactures instrumentation for Nuclear Magnetic Resonance (NMR), Nuclear Quadrupole Resonance (NQR) and MRI markets plans to merge with Magnetica, an Australian MedTech and engineering company specialising in next-generation Magnetic Resonance Imaging (MRI) technologies.
The merger completion is subject only to Magnetica’s shareholder approval at an upcoming General Meeting on 29 January.
The deal is expected to see Avingtrans PLC (Avingtrans) – which owns a majority stake in Scientific Magnetics – acquire the majority shareholding in the new business, which will continue to be known as Magnetica. The combined business will become the key part of Avingtrans’ Medical and Industrial Imaging division moving forward. Scientific Magnetics and Tecmag will become wholly-owned subsidiaries of Magnetica.
The deal will create a Combined Business with total net assets of approximately £5.3 million, on a proforma basis, and will also see Avingtrans invest up to £3.2m in the newly-formed business, to fund new MRI product development and ongoing commercialisation of existing prototype products developed by the individual entities to date.
Steve McQuillan, CEO of Avingtrans, said: “We believe this merger offers real potential to accelerate our planned move up the value chain in what is a highly-specialised and integrated, international medical imaging market.
“By combining the expertise of Magnetica, Scientific Magnetics and Tecmag in a single entity, there is an exciting opportunity to become a leading MRI systems integrator for a variety of niche markets, as well as the prospect of increasing accessibility to high-quality medical imaging around the world.”
All three companies have the expertise and track record in the development and manufacturing of Magnetic Resonance subsystems, and the combination of assets, knowledge and supply chains will enable new products to be offered on a globally-competitive basis.
Unlike traditional large and heavy whole-body MRI systems, Magnetica will focus on smaller, lighter-weight superconducting MRI systems for dedicated applications such as extremity imaging. This is likely to include cryogen-free models, which require significantly lower infrastructure costs than traditional MRI machines, making them suitable for use in a variety of non-traditional locations.
Delivering such compact superconducting MRI systems to the market will enable clinicians around the world to use essential imaging tools in new locations, closer to the patient point-of-care, without compromising the quality of images traditionally obtained from whole-body MRI systems.
Duncan Stovell, CEO of Magnetica, said: “The proposed merger with Scientific Magnetics and Tecmag will not only expand our product portfolio but also provide access to core intellectual property, design specifications and key OEM in-house magnet manufacturing capability to allow us to move up the value chain.
“Avingtrans has developed a strong reputation for successfully investing in and growing engineering businesses in highly-engineered, niche markets. When they outlined their vision for the newly-merged company to our Board, we were unanimous in our agreement that they are the right partner to take the business to the next level and become a disruptive new force as an OEM MRI system provider.”