A Diagnostics & Imaging Week

Vital Images (Minnetonka, Minnesota) reported the pricing of an underwritten public offering of 3 million shares of newly issued common stock at $31 per share before underwriting discounts and commissions.

The company has granted to the underwriters a 30-day option to purchase up to an additional 450,000 shares of common stock to cover any over-allotments.

Vital Images intends to use the roughly $87.5 million in net proceeds for general corporate purposes, including expanding sales and marketing, customer service and training efforts internationally and investing in product development resources. The company said it also intends to use the net proceeds for the acquisition of or investment in businesses, products and technologies that are complementary to its current products, can enhance the company's market coverage or technical capabilities, or offer growth opportunities.

Piper Jaffray & Co. acted as the sole book-running manager for the offering. Wachovia Capital Markets, Jefferies & Co., and Thomas Weisel Partners acted as co-managers for the offering.

Vital Images is a provider of advanced visualization and image analysis solutions. The company's technology gives radiologists, cardiologists, oncologists and other medical specialists time-saving productivity and communications tools that can be accessed throughout the enterprise and via the Web in the day- to-day practice of medicine.

In other financing news:

• Varian Medical Systems (Palo Alto, California) said its board has authorized the company to repurchase up to another 4.5 million shares of its stock over a nine-month period through Sept. 27, 2007.

As of the end of FY06, Varian said it had repurchased about 4.5 million shares of stock under an existing 6 million share repurchase program which extends through December 2006.

Since beginning stock repurchases in FY01, the company said it has spent about $864 million to repurchase roughly 23.9 million shares of stock at an average price of about $36 per share. As of the end of its FY06, the company had a reported $366 million in cash and marketable securities.

Varian develops products for treating cancer and other conditions with radiotherapy, brachytherapy, and radiosurgery. The company also supplies X-ray tubes and digital detectors for imaging in medical, scientific, and industrial applications.

• Alliance Imaging (Anaheim, California) has reported the pricing of an underwritten secondary public offering of 8 million shares of its common stock by certain selling stockholders at a public offering price of $5.75 per share. The underwriters of the offering have a 30-day option to buy up to an additional 1.2 million shares of common stock from selling stockholders to cover over-allotments, if any. Alliance Imaging will not receive any proceeds from this transaction, the company said.

Citigroup Corporate and Investment Banking and Merrill Lynch & Co are acting as joint book-running managers for the underwritten offering. Deutsche Bank Securities and Piper Jaffray & Co. are acting as co-managers for the underwritten offering. The offering is being made only by means of a written prospectus forming part of the effective registration statement.

Alliance Imaging is a provider of shared-service and fixed-site diagnostic imaging services, based on annual revenue and number of diagnostic imaging systems deployed. Alliance provides imaging and therapeutic services to hospitals and other healthcare providers on a shared and full-time service basis, in addition to operating fixed-site imaging centers. The company had 494 diagnostic imaging systems, including 334 MRI systems and 71 PET or PET/CT systems, and served over 1,000 clients in 43 states at Sept. 30, 2006. Of these 494 diagnostic imaging systems, 74 were in fixed-sites, which includes systems installed in hospitals or other buildings on or near hospital campuses, medical offices or medical and retail sites.