Galen Partners has merged two medical imaging-services businesses to create a single company that can provide an array of offerings nationwide. The firm created a holding company, Medical Imaging Holdings Inc., to acquire Echoserve Inc., which had raised an undisclosed amount from Galen, its only venture investor, and Barrington Medical Imaging LLC, which was not venture-backed. Financial details, such as the amount invested in Medical Imaging Holdings and the price paid to buy the companies, were not disclosed. The firm, however, plans to use the holding company to buy additional companies, Managing Director David Jahns and Principal David Azad said in an email. The combined company, to be based in Golden, Colo., will be profitable from the start, according to Jahns and Azad, though they declined to disclose projected annual sales. The firm formed Medical Imaging Holdings in conjunction with Jeff Soinski, a Galen special venture partner and former chief executive of Specialized Health Products International Inc., a Galen-backed company acquired by C.R. Bard Inc. in June 2008. The two companies are now working together under Soinski as chief executive. Full integration is expected to be completed by the end of the fourth quarter. The combined company will maintain operations in Cary, Ill., Barrington Medical Imaging's location, as well as Golden. Echoserve and Barrington Medical will continue to operate under their own names for now, but a new name will be chosen for the combined company later this year. Echoserve provides equipment, service, and parts sales and repair to hospitals, imaging centers, clinics, service organizations and equipment dealers in the physiological-monitoring and medical-imaging markets. Its primary focus is on ultrasound and mammography. Barrington Medical, meanwhile, specializes in the sales, service and support of refurbished computed tomography systems, magnetic resonance imaging systems, and PET/CT systems. Executives from the two companies were not available for comment. This is not the first time Galen has been the founding investor in a company headed by an executive who had guided another portfolio company to success. After portfolio company TheraTx Inc. was acquired by Vencor Inc., in 1997, TheraTx CEO John Bardis joined the firm as a special venture partner. In 1999, Galen provided the founding equity investment for MedAssets Inc., with Bardis serving as CEO. MedAssets, whose services help improve cash flow and operating margins for health care providers, went public in 2007. http://www.galen.com
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