Dive Brief:

• Hill-Rom Holdings is set to buy mobile healthcare communications company Voalte for $180 million upfront, plus up to $15 million in commercial milestones.

• The acquisition will give the medical equipment and technology maker control of a voice, alarm and text communications system that connects 220,000 caregivers at healthcare organizations.

• Hill-Rom thinks integrating the communications system with its existing portfolio of vital signs monitors, connected hospital beds and other devices will improve workflows and patient care.

Dive Insight:

Hill-Rom has sought to reposition its business in recent years by divesting units such as its third-party rental operation and reallocating resources to faster-growing, higher-margin areas. John Groetelaars, who took over as CEO 10 months ago, has made M&A a central pillar of the repositioning strategy. In January, Groetelaars told investors Hill-Rom was "engaged in multiple fronts around M&A."

Now, one of the M&A opportunities pursued by Hill-Rom has concluded in a takeover. Hill-Rom is set to acquire a communications system in a deal that is in line with its vision for building a portfolio of connected devices that hospitals will link together through digital command centers.

"Interoperability and connectivity have become critical elements in providing quality healthcare, reducing length of stay and driving efficiencies across the healthcare continuum," Groetelaars said in a statement. "This transaction strategically fits with our vision of advancing connected care to improve workflow and real-time actionable insights at the point of care."

Hill-Rom thinks hospitals that adopt connected technologies will make their workflows more efficient while delivering improvements to health outcomes, such as reductions in the number of patient falls.

Voalte could move Hill-Rom closer to that vision by giving it a communications system that connects its smart devices to the caregivers who need to act on the data they generate. The acquired company has annual revenues of under $40 million and more than 200 healthcare customers.

Hill-Rom has been looking for accretive acquisitions but in the near term the Voalte takeover will be modestly dilutive. Management expects the deal to become increasingly accretive from 2020 onward. Shares in Hill-Rom, which has a $7 billion market cap, rose 2% in the days following the deal.