By Eric Fetters
Herald Writer
BOTHELL — SonoSite Inc. announced Friday a public offering of 2.7 million shares of its stock, just as the maker of hand-held ultrasound devices prepares to compete directly with General Electric.
In a new commercial for the Winter Olympics, GE unveiled its own hand-carried ultrasound product similar to SonoSite’s devices.
Mike Schuh, chief financial officer for SonoSite, said the money raised by the stock sale will help the company contend with its new rival.
"Certainly, as the market gets more competitive, we wanted to make sure we were strong financially. But more importantly, this will allow us to take advantage of opportunities in new markets."
SonoSite currently has 11.3 million shares. Shares closed Friday at $23.10, down from a 52-week high of just over $28.
The date of the public offering depends on how quickly the Securities and Exchange Commission approves the proposed stock sale.
When General Electric’s recent commercials offered a peek at the company’s new ultrasound device, SonoSite executives were not surprised.
"We had known GE was coming with a new product for quite a while. We didn’t know what the introduction date was, but we knew they were going to do the Olympic commercials," said Jens Quistgaard, chief product and marketing officer for the Bothell-based company.
With the looming prospect of going head-to-head with GE, Quistgaard said SonoSite is ready. In fact, the company’s leaders even feel somewhat flattered.
"We think it reflects very positively on us," Quistgaard said. "We’ve always been of the opinion that point-of-service ultrasound is what people want. … When you see the largest imaging company in the world entering the market, that shows what an important market it is."
Since spinning off from ATL Ultrasound in 1998, SonoSite has built its annual sales to more than $45 million. In December, the company shipped its 5,000th hand-carried ultrasound device, used by doctors and medical technicians in a range of specialties, in just over two years.
That gives SonoSite a headstart over GE. Based on what Quistgaard has heard, GE may not be ready to start shipping its portable ultrasound model until July or later. He hasn’t run into anyone yet who has seen a prototype of the device.
A spokesman from GE’s medical division could not be reached for comment.
"What they’ve built so far is a commercial," Quistgaard said. "But it would be very surprising if they had the quality and capabilities right at introduction that we already have.
"GE has some very smart people in there, and we certainly respect them as a competitor. But they’re not superhuman."
GE would become SonoSite’s first major competitor for hand-held ultrasound devices. The biomedical company’s digital systems already compete with less portable, larger systems made by industry giants.
General Electric does have one advantage over SonoSite: deep pockets. But Quistgaard said SonoSite has the upper hand in its focus on and responsiveness to the portable ultrasound market.
"The thing to compare is not the billions of dollars that GE spends, but how much we spend on just hand-carried ultrasound systems," he said.
You can call Herald Writer Eric Fetters at 425-339-3453
or send e-mail to fetters@heraldnet.com.
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