Richardson Electronics sold most healthcare assets to DirectMed Imaging while consolidating remaining operations into its PMT unit.
Quiver AI Summary
Richardson Electronics has sold the majority of its Richardson Healthcare assets to DirectMed Imaging in a strategic move to focus on growing its Green Energy Solutions business. This transaction, finalized on January 24, 2025, includes a ten-year global supply agreement in which Richardson will provide repaired Siemens CT X-ray tubes to DirectMed and continue manufacturing ALTA CT X-ray tubes for them for the next 12 to 18 months. The remaining healthcare operations will be integrated into Richardson's PMT segment. CEO Edward J. Richardson emphasized that this decision will simplify the company’s structure, enhance its financial model, and allow better focus on profitable growth areas. Further details will be filed with the SEC.
Potential Positives
- Richardson Electronics successfully sold a majority of its healthcare assets to DirectMed Imaging, allowing the company to realign its focus on its growing Green Energy Solutions business.
- The company entered into a 10-year exclusive global supply agreement with DirectMed for Siemens CT X-ray tubes, ensuring a steady revenue stream for the next decade.
- The consolidation of remaining healthcare operations into the PMT strategic business unit is expected to simplify the company's business model and improve overall financial performance.
Potential Negatives
- The sale of a majority of Richardson Healthcare assets may indicate a significant reduction in the company's presence in the healthcare market, which could negatively impact its overall market position and brand perception.
- The consolidation of remaining healthcare operations into the PMT segment could lead to operational inefficiencies and loss of focus, as resources are reallocated away from healthcare solutions.
- The reliance on a long-term supply agreement with DirectMed for CT X-ray tubes raises concerns about dependency, potentially limiting Richardson Electronics' flexibility and bargaining power in the future.
FAQ
What significant agreement was announced by Richardson Electronics?
Richardson Electronics announced the sale of a majority of Richardson Healthcare assets to DirectMed Imaging along with a 10-year supply agreement.
How will the sale affect Richardson Electronics' healthcare operations?
The remaining healthcare operations will be consolidated into Richardson’s PMT reportable segment, focusing on CT X-ray tube manufacturing and repair.
What is the strategic purpose of this transaction for Richardson Electronics?
This transaction supports the company's strategic priorities by reallocating assets to bolster their expanding Green Energy Solutions business.
Who is DirectMed Imaging?
DirectMed Imaging is an aftermarket provider of diagnostic imaging parts and services, serving major imaging equipment brands globally.
Where can I find more information about this press release?
Additional information can be found in the 8-K form that will be filed with the U.S. Securities and Exchange Commission.
Disclaimer: This is an AI-generated summary of a press release distributed by GlobeNewswire. The model used to summarize this release may make mistakes. See the full release here.
$RELL Insider Trading Activity
$RELL insiders have traded $RELL stock on the open market 9 times in the past 6 months. Of those trades, 8 have been purchases and 1 have been sales.
Here’s a breakdown of recent trading of $RELL stock by insiders over the last 6 months:
- KATHLEEN MCNALLY (EVP Global Supply Chain) sold 7,940 shares for an estimated $95,280
- JAMES BENHAM has made 2 purchases buying 5,000 shares for an estimated $66,630 and 0 sales.
- PAUL J PLANTE purchased 3,823 shares for an estimated $50,960
- KENNETH HALVERSON has made 3 purchases buying 4,200 shares for an estimated $50,699 and 0 sales.
- ROBERT H KLUGE has made 2 purchases buying 4,000 shares for an estimated $46,740 and 0 sales.
To track insider transactions, check out Quiver Quantitative's insider trading dashboard.
$RELL Hedge Fund Activity
We have seen 37 institutional investors add shares of $RELL stock to their portfolio, and 32 decrease their positions in their most recent quarter.
Here are some of the largest recent moves:
- AZARIAS CAPITAL MANAGEMENT, L.P. added 129,838 shares (+43.3%) to their portfolio in Q3 2024, for an estimated $1,602,200
- JPMORGAN CHASE & CO added 114,065 shares (+300.0%) to their portfolio in Q3 2024, for an estimated $1,407,562
- ROYCE & ASSOCIATES LP added 90,164 shares (+8.7%) to their portfolio in Q3 2024, for an estimated $1,112,623
- DDD PARTNERS, LLC added 77,746 shares (+7.1%) to their portfolio in Q3 2024, for an estimated $959,385
- ACADIAN ASSET MANAGEMENT LLC added 57,174 shares (+inf%) to their portfolio in Q3 2024, for an estimated $705,527
- FIRST WILSHIRE SECURITIES MANAGEMENT INC removed 52,465 shares (-12.1%) from their portfolio in Q3 2024, for an estimated $647,418
- ACUITAS INVESTMENTS, LLC removed 30,000 shares (-91.3%) from their portfolio in Q3 2024, for an estimated $370,200
To track hedge funds' stock portfolios, check out Quiver Quantitative's institutional holdings dashboard.
Full Release
Majority of Richardson Healthcare Assets Sold to DirectMed Imaging
Remaining Healthcare Business to be Consolidated into the Company’s PMT Strategic Business Unit
LAFOX, Ill., Jan. 24, 2025 (GLOBE NEWSWIRE) -- Richardson Electronics, Ltd. (NASDAQ: RELL), a global provider of engineered solutions for renewable energy and other power management applications, today announced the strategic asset sale of a majority of Richardson Healthcare to DirectMed Imaging (“DirectMed”). The transaction closed on January 24, 2025.
Under the terms of the transaction, Richardson Electronics sold a substantial portion of the Richardson Healthcare reportable segment to DirectMed. Additionally, Richardson Electronics entered into an exclusive 10-year global supply agreement in which Richardson will supply DirectMed with repaired Siemens CT X-ray tubes. Richardson Electronics will also continue manufacturing ALTA CT X-ray tubes for DirectMed for approximately 12 to 18 months. The remaining assets and operations of the Richardson Healthcare reportable segment, primarily CT X-ray tube manufacturing and repair, will be consolidated into the Company’s PMT reportable segment.
“Today’s announcement is aligned with our strategic priorities by reallocating assets to support our fast-growing Green Energy Solutions business. We look forward to an ongoing partnership with DirectMed, which we believe is a win-win for both companies. In addition, we believe today’s announcement will simplify our business, improve our financial model, and allow us to prioritize profitable opportunities within our higher growth markets,” said Edward J. Richardson, Chairman, CEO, and President.
Additional information on the transaction will be found in an 8-K to be filed with the U.S. Securities and Exchange Commission.
FORWARD-LOOKING STATEMENTS
This release includes certain “forward-looking” statements as defined by the Securities and Exchange Commission. Statements in this press release regarding the Company’s business that are not historical facts represent “forward-looking” statements that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see Item 1A, “Risk Factors” in the Company’s Annual Report on Form 10-K filed on August 5, 2024, and other reports we file with the Securities and Exchange Commission. The Company assumes no responsibility to update the “forward-looking” statements in this release as a result of new information, future events or otherwise.
About Richardson Electronics, Ltd.
Richardson Electronics, Ltd. is a leading global manufacturer of engineered solutions, green energy products, power grid and microwave tubes, and related consumables; power conversion and RF and microwave components, including green energy solutions; high-value replacement parts, tubes, and service training for diagnostic imaging equipment; and customized display solutions. Approximately 50% of our products are manufactured in LaFox, Illinois, Marlborough, Massachusetts, or Donaueschingen, Germany, or by one of our manufacturing partners throughout the world. All our partners manufacture to our strict specifications and per our supplier code of conduct. We serve customers in the alternative energy, healthcare, aviation, broadcast, communications, industrial, marine, medical, military, scientific, and semiconductor markets. The Company's strategy is to provide specialized technical expertise and "engineered solutions" based on our core engineering and manufacturing capabilities. The Company provides solutions and adds value through design-in support, systems integration, prototype design and manufacturing, testing, logistics, and aftermarket technical service and repair through its global infrastructure. More information is available at www.rell.com .
Richardson Electronics common stock trades on the NASDAQ Global Select Market under the ticker symbol RELL.
About DirectMed Imaging
DirectMed Imaging is a leading aftermarket diagnostic imaging parts, systems, and service provider. With over 100,000 parts in stock, the company repairs, supports, and sells GE, Siemens, Philips, and Canon/Toshiba MRI, CT, and X-ray parts to healthcare networks, imaging centers, and independent service organizations (“ISOs”) around the world. DirectMed also owns LBN Medical ApS, based in Aalborg, Denmark, a leading reseller of aftermarket medical imaging equipment and parts to customers around the world; and ScanMed, LLC, a leader in MRI coil design, manufacture, and repair. For more information, visit www.DirectMedImaging.com .
For Details Contact:
Wendy Diddell
Chief Operating Officer and GM, Richardson Healthcare
Phone: (630) 208-2323
[email protected]
Corporate Headquarters
40W267 Keslinger Road
PO BOX 393
LaFox, IL 60147-0393 USA
(630) 208-2200 | Fax: (630) 208-2550