Is There an IPO in InSightec's Future?

Elbit Medical Imaging’s (EMITF), subsidiary InSightec has raised $30 million in an internal financing round. Investors were Elbit Medical Imaging subsidiary Elbit Ultrasound (Netherlands) BV, General Electric Company (GE) subsidiary GE Capital Equity Holdings Inc., MediTech Advisors LLC, and some InSightec directors and officers. Elbit Ultrasound invested $19.8 million, boosting its stake in InSightec to 53%.

InSightec develops a product that combines MRI technology with focused ultrasound in order to treat serious diseases such as bone, liver and brain tumors, without the invasive procedures that are currently used.

The question needs to be asked when is it planning an IPO? There have been rumors for the better part of 2 years about a billion dollar IPO, but to date, nothing has been done.

In an interview with Globes, Elbit Medical Imaging president Shimon Yitzhaki answered the question:

Globes: You originally planned to float InSightec in 2005 and sales haven’t risen substantially since then. Are you disappointed?

Yitzhaki: Not at all. InSightec is an amazing breakthrough company. The board tells us that it will be worth billions, maybe more than all our real estate deals. Just a little patience is needed. We believe that with the products in the pipeline and insurance reimbursement, within two or three years, we’ll reach hundreds of millions in sales.

Globes: Will you reopen your IPO plans?

Yitzhaki: We’re waiting on the IPO until we have insurance reimbursement from a number of insurers as well as FDA approval for at least one of our cancer treatments. There are also other options besides an IPO.

Disclosure: The author has a position in EMITF, but has no positions in any other stock mentioned as of November 30, 2007.