US medical technology company Becton Dickinson to buy C R Bard for $24 bn
24 April 2017
US medical technology company Becton Dickinson and Co (BD) yesterday struck a deal to buy its peer C R Bard Inc in a $24-billion cash and stock deal.
The deal comes three years after BD acquired infusion pumps and other medical devices maker CareFusion Corp for $12.2 billion. (See: Becton Dickinson to acquire CareFusion for $12.2 bn)
Under the terms of the deal, Bard shareholders will receive around $222.93 in cash and 0.5077 shares of BD stock, or a total of value of $317.00 based on BD's closing price on 21 April.
The deal equates to a 25.3-per cent premium to Bard's Friday closing price of $253.07.
Post closing, Bard shareholders will own approximately 15 per cent of the combined company.
BD expects to generate around $300 million in annual, pre-tax, run-rate cost synergies by fiscal year 2020, and also expects to benefit from revenue synergies from fiscal year 2019.
The combination will create a highly differentiated medical technology company uniquely positioned to improve both the process of care and the treatment of disease for patients and healthcare providers.
The transaction will build on BD's leadership position in medication management and infection prevention with an expanded offering of solutions across the care continuum. Additionally, Bard's strong product portfolio and innovation pipeline will increase BD's opportunities in fast-growing clinical areas, and the combination will enhance growth opportunities for the combined company in non-U.S. markets.
"This financially compelling transaction will be immediately accretive and is expected to generate high-single digit accretion to adjusted earnings per share (EPS) in fiscal year 2019," BD said ina statement.
The transaction is expected to improve BD's gross margins by approximately 300 basis points in fiscal year 2018, increase BD's earnings per share growth trajectory to the mid-teens, and generate strong cash flow.
BD said that the acquisition will further expand its leadership in infection prevention, and be able to address 75 per cent of the most costly and frequent healthcare associated infections.
The new company will have also have a more comprehensive, clinically relevant offering to address Surgical Site Infections and Catheter-Related Blood Stream Infections.
Based in New Jersey, Bard specializes in the manufacturing of vascular, urology, oncology and surgical specialty products.
Bard markets its products and services worldwide to hospitals, individual health care professionals, extended care facilities, and alternate site facilities.
It employs around 14,000 people and has annual revenue of $3.71 billion.
BD manufactures and sells a range of medical supplies, devices, laboratory equipment and diagnostic products.
The New Jersey-based company operates through two segments: BD Medical and BD Life Sciences.
The medical segment produces a range of medical technologies and devices that are used to help improve healthcare delivery in a range of settings. BD Medical consists of various business units, including diabetes care, medication and procedural solutions, medication management solutions and pharmaceutical systems.
Its life sciences segment provides products for the safe collection and transport of diagnostics specimens, and instruments and reagent systems to detect a range of infectious diseases, healthcare-associated infections and cancers.
Its manufacturing plants outside the US are located in Bosnia and Herzegovina, Brazil, Canada, China, Dominican Republic, France, Germany, Hungary, India, Ireland, Italy, Japan, Mexico, the Netherlands, Singapore, Spain and the UK.
It sells its products under various brands, such as BD Hypak, Alaris, Pyxis and Vacutainer, BD Kiestra, BD Max, BD BACTEC, SurePath, Veritor, BD ProbeTec and BD Viper.
''Combining with Bard will accelerate our ability to offer more comprehensive, clinically relevant solutions to customers and patients around the globe, creating a strong partner for healthcare providers who are increasingly focused on delivering better outcomes at a lower total cost,'' said, Vince Forlenza, BD's chairman and CEO.