Magnetica, an Australian medtech and engineering company that specializes in next-generation MRI technologies, plans to merge with Scientific Magnetics and its subsidiary Tecmag. Scientific Magnetics is a UK-based manufacturer of bespoke superconducting magnet systems and Tecmag makes instrumentation for the nuclear magnetic resonance (NMR), nuclear quadrupole resonance (NQR), and MRI markets. The merger is subject to Magnetica shareholder approval, which is expected to occur Jan. 29.
The deal is expected to see 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. The merger will create a combined business with total net assets of roughly £5.3 million, on a pro-forma 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.
Avingtrans CEO Steve McQuillan said the merger will potentially accelerate the company's planned move up the value chain in what is a highly-specialized 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," McQuillan said.
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.
“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," said Duncan Stovell, CEO of Magnetica.
“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.”