UPDATE 1-Philips buys software company TOMCAT Systems

(Rewrites with Philips confirmation, adds share price)

AMSTERDAM, March 26 (Reuters) - Philips Electronics (PHG.AS: Quote, Profile, Research, Stock Buzz) (PHG.N: Quote, Profile, Research, Stock Buzz) said on Wednesday it will buy Irish medical software company TOMCAT Systems as it expands its medical sector business to tap more stable, higher-margin revenues.

Philips said in a statement it expected the deal to close by the second quarter this year and TOMCAT, which develops software used for cardiology health services, would become part of Philips' healthcare unit.

Privately owned TOMCAT employs about 25 people and has more than 85 clients in countries such as Britain and Canada, Philips said.

TOMCAT makes cardio-vascular information systems (CVIS) and the global industry for cardiology informatics is estimated to grow to more than 400 million euros ($623 million) in 2011 from an estimated 275 million euros in 2008, Philips said.

Philips shares were down 1.8 percent at 24 euros by 0812 GMT. (Reporting by Gilbert Kreijger; Editing by Louise Ireland)