Eastman Kodak to purchase PracticeWorks Inc. in cash deal

Weekly Corporate Growth Report, Jul 28, 2003

The Deal: Eastman Kodak Company has agreed to acquire PracticeWorks Inc. Kodak will pay $21.50 in cash for each common share of PracticeWorks outstanding, or about $382.7 million. In addition, Kodak will pay $7.33 for each Series B referred share, plus about $34 million in assumed debt and transaction fees, bringing the total deal value to approximately $500 million in cash. The deal still requires shareholder and regulatory approvals.

Discussion: PracticeWorks makes software that allows dentists to manage dental front office functions such as scheduling, billing, and record keeping. Company software is also used to track insurance and benefits information, enable online purchasing of orthodontic and office supplies, and manage clinical information and patient charts.

Eastman Kodak is the leading maker of photographic film in the world. The company also makes specialty film, paper, and processing equipment for professionals in the health care and entertainment industries, including dental x-ray film. Kodak is also devoting resources to digital imaging media and related products.

Kodak estimates that worldwide sales of dental practice management software exceed $200 million annually and are expected to grow eight to ten percent per year. After the deal closes, Kodak intends to add PracticeWork's product lines into the portfolio marketed to dentists by Kodak's Health Imaging Group.