Shares of Merit Medical Systems have jumped more than 9 percent this morning after the company announced it plunked down $100M for two product lines belonging to Becton, Dickinson and Company.
Shares of Merit Medical Systems have jumped more than 9 percent this morning after the company announced it plunked down $100 million for two product lines belonging to Becton, Dickinson and Company (BD).
BD is selling the assets in connection with its acquisition of C.R. Bard Inc. (Bard). Merit will acquire soft tissue core needle biopsy products currently sold by BD under the trade names of Achieve Programmable Automatic Biopsy System, Temno Biopsy System and Tru-Cut Biopsy Needles. Additionally, Merit will acquire the Aspira Pleural Effusion Drainage Kits and the Aspira Peritoneal Drainage System currently marketed by Bard.
“We believe this is a perfect fit for Merit,” Merit’s Chairman and Chief Executive Officer Fred Lampropoulos said in a statement. “These products are well established with an installed base and complement Merit’s CorVocet Full Core Biopsy System and our recently-acquired bone biopsy products.”
Lampropoulos said there are a number of markets in which the company already has direct representation regarding sale of the new assets. He added that the company also plans to develop a presence in new markets.
“In summary, we believe this transaction will provide complementary high-margin products, increased use of our existing facilities, market expansion opportunities, accretive margins, profits and our existing sales force utilization,” Lampropoulos said.
Merit said it will finance the acquisition through a borrowing program that is currently available under its revolving credit facility.
Vincent Forlenza, chairman and CEO of BD, said the intention of divesting BD of the two asset lines is another step in the regulatory review process for BD’s planned acquisition of Bard.
The deal with BD is not the first asset acquisition this year for Merit. In February, Merit spent $48 million to acquire the critical care business unit from Argon Medical Devices, Inc. That sale included a manufacturing facility in Yishun, Singapore and related commercial operations in Europe and Japan. The company also made additional acquisitions, which it highlighted in its Oct. 25 quarterly report.
“Recently, we made four strategic tuck-in acquisitions. The first, the assets we acquired from Laurane Medical, add additional bone biopsy technology to our biopsy portfolio. Second, we acquired the assets of Osseon, which adds products and technology to our vertebral augmentation and kyphoplasty portfolio. The products and technologies acquired in these two transactions will be manufactured at our facility in Ireland as we scale both of these businesses,” Lampropoulos said in a statement. “Third is the acquisition of IntelliMedical Technologies in Melbourne, Australia. IntelliMedical is an early-stage company which has developed technology designed to use magnets and Bluetooth technology to steer guide wires remotely. This follows a number of new products, such as the SwiftNINJA Steerable Microcatheter and the HeartSpan Steerable Sheath, which provide improved accuracy and speed during procedures.”
In October, Merit announced third quarter revenue was up 14.2 percent over the same period as the previous year. Shares of Merit Medical Systems are trading at $40.80 as of 11:03 a.m.
