Tech- 3411: One-of-a-Kind MRI, PET-CT Center in Southeast

Tech–3411: One-of-a-Kind Imaging Center in Southeast

Physician Owner Busy with Other High-Priority Projects
Significant Growth Possibilities


This independently owned and operated Imaging center in the Southeast is in a highly desirable, business-friendly area undergoing rapid growth.

The facility housing this imaging center was custom-built in 2007. The physician-owner owns the building and runs his neurology and neurodiagnostic practice on one side and the Imaging Center on the other.

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The imaging side provides complete services for MRI, MRA, CT scan, PET scan, Ultrasound,3-D Mammogram, and X-ray. The neurodiagnostic side provides EEG, EMG, Ambulatory Video EEG, and sleep studies. While board-certified radiologists read the imaging studies, the owner, a board-certified neurologist, reads the Neuro studies and can do the same for the buyer in the transition period. The sleep center located in this facility is also widely used for research.

So, in many ways, this is a unique and one-of-a-kind Imaging Center. While both, the neurology practice and the imaging center, are independent entities, a savvy buyer will be able to benefit by also offering Neuro-diagnostic tests and sleep studies. While the owner will refer his patients to the Center, the buyer can do additional marketing to get more patients for sleep studies and other neurodiagnostic tests. A video EEG test, for example, fetches about $4,000 per test. The Center currently does two per week, but this volume could be increased significantly.

The Imaging Center and the Neurology businesses are in-network with multiple commercial insurances and Medicare. The Center is ACR accredited, and all the machines are well-maintained with service contracts.

The Center used to have a revenue of about $4.5 million annually some 10-12 years ago. Even after accounting for reimbursement cuts, it can potentially get $3-$3.5 million in revenue.

Currently, the owner manages multiple sizeable real estate projects and cannot give full attention to growing the imaging business. Therefore, after 15 years in this business, he is looking to divest it to someone who can take advantage of the tremendous potential of the Center and continue the Center’s legacy of providing timely and caring professional services to its clients.

A buyer has several options for buying the business:

  1. Buy just the MRI and PET business (and rent only half the building space)
  2. Buy MRI and PET business and also offer sleep studies (and rent the entire building space)
  3. Buy MRI and PET business, provide sleep studies, and neurodiagnostic studies (and rent the full building)

For the second and third options, the owner can provide the buyer readings of neurological and sleep study scans during the transition phase for the buyer. 

FINANCIAL SUMMARY

  2021 2020 2019
Revenue $1,172,887 $1,275,920 $1,436,897
EBITDA $75,231 $121,264 $93,575
Add Half of Neurodiagnostic EBITDA
(This will come to the Center)
$114,303 $53,653 $157,969
Total EBITDA $189,534 $174,917 $251,544

Note that the Pandemic affected the revenue in 2020 and 2021. But even 2019 revenue and EBITDA are far below the potential of this unique Center. The historical data has shown that the Center, in the hands of a focused and motivated buyer, can bring in revenues of $3-3.5M, as mentioned above. And there is no independent center that can offer these many modalities in the surrounding area.

The total asset value of the business is $1.1 Million. As shown in a later section on assets, the value of the MRI and PET Center are about $850K, and the balance is from the Neurodiagnostic section.

ASKING PRICE

The asking price of the business is based on the asset value. It is priced at $1.1M if the buyer buys all of the imaging modalities, including neurodiagnostic and MRI, and PET business. Optionally the buyer can buy only MRI and PET business, or MRI and PET plus sleep study business.

 

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