BD To Acquire Bard For $24 Billion

1-IndustryUpdates-BD

BD and C.R. Bard Inc. recently announced a definitive agreement under which BD will acquire Bard for $317 per Bard common share in cash and stock, for a total consideration of $24 billion. The agreement has been unanimously approved by the boards of directors of both companies.

The combination will create a medical technology company positioned to improve the process of care and the treatment of disease for patients and health care providers. The transaction will build on BD's position in medication management and infection prevention with an expanded offering of solutions across the care continuum. Additionally, Bard's 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 transaction will be immediately accretive and is expected to generate high-single digit accretion to adjusted earnings per share (EPS) in fiscal year 2019.  Approximately $300 million of estimated annual, pre-tax, run-rate cost synergies are expected by fiscal year 2020. Separately, BD also expects to benefit from revenue synergies beginning in fiscal year 2019. 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.

Vince Forlenza, BD's chairman and chief executive officer, said, "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 health care providers who are increasingly focused on delivering better outcomes at a lower total cost. Our two purpose-driven organizations are well aligned strategically, sharing a strong track record of performance and a deep commitment to addressing unmet needs in today's challenging health care environment. We expect the transaction to contribute meaningfully to BD's plans for revenue growth and margin expansion, and generate outstanding value both near- and long-term for shareholders. I am excited to welcome Bard's talented employees to our strong and dedicated team as we bring together two companies with such complementary capabilities, values and strong reputations for delivering superior results."

The transaction is subject to regulatory and Bard shareholder approvals and customary closing conditions, and is expected to close in the fall of 2017.