FONAR receives buyout proposal from management-led group

MELVILLE, NEW YORK - FONAR Corporation (NASDAQ:FONR), a manufacturer of MRI scanning equipment with a market capitalization of $97.34 million, announced Wednesday it has received a preliminary, non-binding acquisition proposal from a group led by Timothy Damadian that includes current management team members, board directors, and third parties. According to InvestingPro data, the company maintains a strong financial health score of "GREAT," supported by robust cash flows and solid balance sheet metrics.

The proposal, dated July 7, offers to acquire all outstanding shares not currently owned by the group at a price "at a premium of no less than 10% to the average closing market price" of FONAR’s stock for the 90 trading days preceding July 1, 2025. With FONAR’s current stock price at $15.46 and trading at a P/E ratio of 12, InvestingPro analysis suggests the company is currently undervalued. According to the announcement, the acquisition group currently owns approximately 5.01% of FONAR’s outstanding shares.

FONAR’s board has established a special committee of independent and disinterested directors to review the proposal and determine the best course of action for the company and its shareholders.

The company cautioned that it has only recently received the proposal and has not yet thoroughly evaluated it. FONAR emphasized that the proposal is merely an indication of interest and does not constitute a binding commitment.

"There can be no assurance that the Company will pursue this transaction or other strategic outcome, or that a proposed transaction will be approved or consummated," the company stated in its press release.

FONAR, which went public in 1981, describes itself as the first and oldest MRI company in the industry. The company’s flagship product is the FONAR UPRIGHT Multi-Position MRI, which can scan patients in various weight-bearing positions including standing and sitting.

No action is required by FONAR shareholders at this time as the board reviews the proposal. InvestingPro subscribers can access additional insights through 7 more exclusive ProTips and comprehensive financial metrics to better evaluate this potential acquisition opportunity.

In other recent news, FONAR Corporation has made notable announcements impacting its corporate structure and governance. The company appointed Robert M. Carrino as a new independent director to its board, filling a vacancy left by the retirement of Claudette J.V. Chan. Carrino, who brings a wealth of public accounting experience, is expected to be a significant asset as FONAR transitions into accelerated filer status. Additionally, during its Annual Meeting of Stockholders, FONAR re-elected its existing board of directors, including Timothy R. Damadian, M.D., and ratified CohnReznick LLP as its auditors for the fiscal year ending June 30, 2025. These developments were disclosed in a recent SEC filing, ensuring transparency and adherence to regulatory standards. The stockholders also gave advisory approval to the compensation for the company’s executive officers. These strategic moves are part of FONAR’s efforts to maintain robust corporate governance and operational transparency.

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