Philips agrees to buy US heart imaging firm Volcano in $1.2 billion deal

IndustriesAssociated Press

Royal Philips NV says it will pay $1.2 billion (around 1 billion euros) for U.S. medical equipment maker Volcano Corp., a deal that would beef up its presence in technology which allows doctors to see inside patients' hearts and veins.

In an agreement backed by Volcano's management, Philips will offer $1 billion for Volcano stock, or $18 per share, a 57 percent premium to its closing price Tuesday of $11.49. Philips will also assume $200 million of debt.

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Philips, a major maker of medical imaging equipment, said Wednesday's deal will allow it to sell its own products to Volcano's customer base, and vice versa. It intends to fold San Diego-based Volcano into an operating arm devoted to "image-guided therapy" — techniques that allow doctors to see inside patients' bodies.