January 10, 2007—Canadian conglomerate Onex Corp (Toronto) will purchase Eastman Kodak Co’s Health Group (Rochester, NY) for around $2.4 billion, the companies announced this morning. Kodak’s health subsidiary focuses on medical imaging and health care information technology.

Onex’s annual revenues come to around $17 billion; Kodak’s medical group brings in around $2.5 billion each year. The acquisition agreement mandates that if Onex’s private-equity fund Onex Partners, which made an equity investment of about $480 million to complete the deal, realizes an internal rate of return in excess of 25% on its investment, Kodak will receive 25% of the excess return up to $170 million.

“Onex is an ideal acquirer of Kodak’s Health Group because they understand the health industry and are committed to growing the business for the benefit of customers and employees,” said Antonio Perez, Kodak’s chairman and CEO. Around 8,100 Kodak employees will continue with the business following the deal’s close, which is expected by mid-year.

In January 2005, Onex acquired Minneapolis-based Center for Diagnostic Imaging (CDI), which operates 39 outpatient diagnostic imaging centers in 9 US markets, for $190 million.

—Cat Vasko