RadNet, Inc, the nation’s largest operator of outpatient diagnostic imaging centers, has acquired Manhattan-based New York Radiology Partners (NYRP), an eight center chain, for $34 million, including the assumption of $4 million in debt, adding a projected $45 million to annual revenue.
"We are delighted to complete our second significant transaction in Manhattan,” said Howard Berger, MD, president and CEO, RadNet, in a prepared statement. “The NYRP facilities are highly complementary to the Lenox Hill operations and other Manhattan centers we have purchased since entering this market at the beginning of 2013.”
RadNet’s growth has been accomplished through strategic expansion in its target markets, and this latest acquisition gives the nation’s largest imaging center operator, with 259 imaging centers, a stronger foothold in New York City. In a prepared statement, Berger indicated that further opportunities exist in the Big Apple.
“We continue to believe that Manhattan, a market that is home to almost 1.7 million residents and that swells to almost four million people on work days, has further opportunities for us to expand our size and capabilities,” he said. “Although a significant amount of imaging is still completed by large hospital systems in this market, our centers represent a lower cost, highly efficient alternative that is focused on providing superior service and access for patients.
NYRP is a joint venture between the West Side Radiology Associates and East Manahattan Diagnostic Imaging practices, and its eight centers are the first in the five boroughs of New York City to have been designated Diagnostic Imaging Centers of Excellence by the American College of Radiology. The radiology practices will continue to provide professional services for the sites.
"On behalf of the physicians and employees of NYRP, we are very pleased to be part of the RadNet family,” said Michael M. Abiri, MD, president of NYRP. “We are eagerly looking forward to the benefits that RadNet can bring to our operation, including providing us the ability to grow more effectively within our markets and to more efficiently service our referring physician communities and loyal patient populations.”
Abiri also perceives growth, efficiency and contracting opportunities for the practices due to RadNet's strong presence in the market, as a result of the relationship.
Berger said the transaction not only adds 200,000 procedures annually to RadNet’s capacity in the Manhattan market, but also strengthens the company’s professional physician capabilities in Manhattan.
The company’s stock closed down 3.86% at $8.72 on the news.