The series of acquisition and mergers continues with one more news of industrial assets purchases. Philips, a Dutch-based healthcare company, has announced its plans to buy Spectranetics, a medical device manufacturer based in the United States. The deal was closed for $2.16 Billion comprising debt.
The board of directors of Spectranetics accepted the deal. It is anticipated to get sealed in the third quarter of 2017 as well as increase and encourage Philips’ Image-Guided Therapy Business Group. After the closing of the business deal, Spectranetics and its over 900 employees will be part of the Image-Guided Therapy Business Group of Philips.
Spectranetics is known for its devices used for treating heart disease. It uses methods such as lasers and drug-coated balloons to clean the arteries and veins that are blocked due to heart diseases.
Philips, the acquirer, will disburse the shareholders of Spectranetics with $38.50 per share, which is in total 27% premium to closing value on June 27.
Frans van Houten, Chief Executive, Philips, has changed the earlier business into focused healthcare equipment company since past years. The company is selling off its left consumer product business and spinning off its lighting segment. Philips claims that the medical device maker’s estimates of the total sales of approximately $300 Million in the present year will continue to boost the revenue with the double-digit rates and start adding its earnings in Philips in 2018.
“After the acquisition of vascular imaging company Volcano in 2015, this deal of Spectranetics will help to brace our position in heart disease treatment and therapy segment,” Van Houten said.
Houten stated that post process of the acquisition will have a broad lineup of devices for coronary, heart, vascular, and peripheral therapies. The integration of our image-guided systems, which allows doctors to see the internal body, will position us in a competing position in the market.
An analyst from Berenburg reported that acquisition is an excellent strategy but it won’t spur Philips’ return on capital that is invested, at least for coming 5 years, the company’s share declined by 1.35% to 32.1 Euros in morning.
“Spectranetics is good technology-based company and has a potential to add level and width to its offered portfolio of intravascular ultrasound and mechanical atherectomy,” the company stated.
Philips on Wednesday also declared a 1.5 Billion Euro share buyback program, which will be initiated in Q3 and will last for 2 years.
