The Volpara Health Technologies Ltd (ASX: VHT) share price is on course to finish the week with a strong gain.
On Friday afternoon the medical technology company’s shares are up almost 5.5% to $1.69.
Why is the Volpara share price charging higher?
Investors appear to have been scrambling to pick up the company’s shares today after it announced the completion of its US$14.59 million (~A$21.15 million) acquisition of MRS Systems.
MRS Systems is a medical software company that provides comprehensive patient tracking and communication, and a radiology reporting platform for sub-specialty radiology applications including breast and lung imaging.
It is a leading provider of breast clinic management software, with an estimated ~20% market share of breast clinics in the United States.
In the 2019 calendar year the company has forecast annual recurring revenue (ARR) of ~US$4.5 million. Including capital sales, MRS Systems expects ~US$7.5 million of total revenue over the 12 months.
Volpara made the acquisition as it provides it with an expanded and mature presence in the United States, an enlarged sales footprint and technical support, and product suites that are highly complementary. The latter is expected to provide both businesses with cross-selling opportunities.
In addition to this, management believes the combination of MRS clinical data and Volpara images will enrich Volpara’s AI capability.
Volpara’s CEO, Dr Ralph Highnam, said: “We are delighted to welcome MRS Systems and its people into the Volpara group. And we are excited about the opportunity to work alongside MRS Systems in the United States and to grow Volpara’s service offering in the increased number of US breast clinics to which Volpara now has immediate access. The acquisition has involved a tremendous effort from people in both organisations, and I would like to express my thanks to everyone as we look forward to the future with a stronger US base and an extended range of integrated products which will help detect breast cancer earlier.”
Volpara isn’t the only medical technology company on the rise today. The shares of both Nanosonics Ltd (ASX: NAN) and Pro Medicus Limited (ASX: PME) are outperforming the market by some distance on Friday.