January 16, 2013 / 1:00 PM / 6 years ago

UPDATE 1-Canada's CML HealthCare to sell bulk of its imaging business

Jan 16 (Reuters) - Medical diagnostic services provider CML HealthCare Inc said it was in talks with potential buyers for the bulk of its diagnostic imaging business as it focuses on laboratory services.

Canada’s diagnostic imaging industry has come under pressure in recent months as budget deficits in many provinces force governments to review their healthcare funding programs.

CML HealthCare, which said in October it would sell its imaging business in Alberta for C$17 million, has 94 imaging centres in Ontario and British Columbia. The company sold its U.S. imaging operations in 2011.

The company said it does not plan to sell its MRI/CT operations in Ontario.

CML HealthCare wants to complete the sale of its imaging business this year and plans to use the net proceeds to reduce debt and invest in its core laboratory services business.

CML runs 140 patient-service centres in Ontario.

The company had long-term debt of $272.3 million as of Sept. 30, according to a regulatory filing.

CML Healthcare also set a new quarterly dividend of 13.25 Canadian cents per common share. It had declared monthly cash dividend of 6.29 Canadian cents per common share for December.

The company said its fourth-quarter results will include a special charge related to severances and a contract exit.

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