CompuGroup mulling takeover of Agfa

German health IT provider CompuGroup Medical SE has approached Belgian company Agfa-Gevaert about a potential acquisition by way of a public takeover.

CompuGroup is much smaller than its acquisition target, employing 4,300 people with annual sales of $596 million, while Aa employs nearly 10,000 with annual sales near $2.85 billion. According to Belgian newspaper De Tijd, a major roadblock to the deal could be Agfa’s hefty pension obligations—an annual total of more than $82 million.

There are other questions as well concerning CompuGroup’s interest in Agfa’s non-healthcare divisions, which accounted for nearly 60 percent of Agfa’s operating profit in 2015. The graphics and specialty products divisions, meanwhile, were less profitable. It stands to reason that CompuGroup would only be interested in the medical branch of the company, since it specializes in the healthcare industry.

However, the companies’ offerings would complement each other. Agfa installs IT systems for imaging and medical records in hospitals, chiefly their flagship EMR software Orbis. On the other hand, CompuGroup ensures a smooth flow of information from doctors and physio therapists. A merger with Agfa would extend that reach into hospitals.

The combined company would have annual sales of over $3.3 billion. Agfa released a statement saying: “Further announcements will be made in due course, if and when circumstances so require."