Intermagnetics

(IMGC)

, a maker of supercomputing magnets used in medical imaging, agreed to be acquired by Dutch electronics giant

Philips

(PHG) - Get Report

for $1.27 billion, or $27.50 a share.

The price is a 29% premium to Intermagnetics' Wednesday close. The

Nasdaq

-listed company is based in Latham, N.Y., employs about 1,150 people, and earned about $37.5 million on sales of $264 million in the fiscal year ended in May 2005.

"The acquisition of Intermagnetics will strengthen Philips' position in the key market of magnetic resonance imaging," said Philips. "It will allow Philips to significantly rationalize its supply chain, to enhance its competitive position and to participate in the fast growing market for RF coils."

Philips sees the deal adding to operating earnings toward the end of 2007 and said it will take a roughly $100 million charge for in-process research and development, integration and other items.