To strengthen its ICU value chain
MUMBAI: Opto Circuits (India) Ltd, a Bangalore-based medical diagnostics and intervention equipment manufacturer, is close to acquiring a European company for over $100 million to strengthen its expertise in the critical care equipment provision.
Vinod Ramnani, the managing director of Opto Circuits India, said that the target company has expertise in defibulators, an equipment to help restore the natural rhythm of the heart when a person is experiencing a cardiac arrest.
The acquisition will be funded through a combination of qualified institutional placements (QIPs) and warrants.
The existing product range of ICU-specific equipment from Opto Circuits includes pulse oximeters, multiparameter monitors, pulse oximeter sensors and cardiac stents.
To cover the entire range of equipment used in an ICU, the company is going ahead with the strategy of acquisitions and technology transfers.
Through its acquisition of US-based Criticare Systems in February 2008, Opto Circuits gained expertise in non-invasive equipment segment by manufacturing vital sign monitors, anaesthesia monitors and pulse oximeters.
Bodapati Bhaskar, chief financial officer, Opto Circuits, said the company now plans to bring Criticare’s manufacturing capability from Taiwan to its manufacturing hub in Bangalore. “We aim at savings of about 20% in our manufacturing costs.”
In September 2007, the company entered into a technology transfer agreement with Elpro Srl of Italy to manufacture and market four variants of electrocardiogram (ECG) equipment. The non-invasive segment contributes 68% to Opto Circuits’ revenues.
Meanwhile, to get a greater share of the $10-billion invasive equipment market, the company is awaiting USFDA approval for EuroCOR, a German company it acquired in February 2006. In a June note to clients, Urmil Negandhi of Emkay Research, wrote,
“We expect Opto’s invasive segment to grow at 55% during FY08-10. Opto is spending $20 million in a bid to win USFDA approval for Dior, a balloon dilation catheter.”
EuroCOR manufactures cardiac stents used to treat coronary artery blockages. The company exports its entire production to North America, the Middle East, Europe and South Africa. Around 40% of the company’s sales are in the US and its major clients include Agilent Technologies, Philips Medizin, Criticare Systems and Epic Medical Equipments.
Boosted by the USFDA approval for Criticare’s equipment, the company posted sales revenues of Rs 177.36 crore and a net profit of Rs 44.98 crore in the first quarter of FY09. “The USFDA approval helped in generating contracts for Criticare products from hospital chains in North America, Europe, and Latin America,” said Valiveti Bhaskar, director (operations) at Advanced Micronic Devices Ltd, an Opto Circuit subsidiary.
t_amit@dnaindia.net
