Abbott Agreed to Buy St. Jude in $25 Billion Deal--Update
April 28 2016 - 7:57AM
Dow Jones News
By George Stahl
Abbott Laboratories agreed to acquire St. Jude Medical Inc. in a
cash-and-stock deal valued at $25 billion that merges two of the
leading makers of heart-related devices.
Under the deal, Abbott agreed to swap $46.75 in cash and 0.8708
shares for each St. Jude share. The offer values each St. Jude
share at about $85, representing a 37% premium to the stock's
closing price Wednesday.
The companies said the deal merges St. Jude Medical's strong
positions in heart-failure devices, heart catheters and
defibrillators with Abbott's strength in coronary intervention and
heart-valve repair.
The merger is occurring as heart disease becomes a bigger
problem. According to the companies, more than 40% of adults in the
U.S. are expected to have one or more forms of heart disease by
2040.
The boards from both companies have approved the transaction,
which still requires shareholder and regulatory approvals. The
companies expect the deal to close in the fourth quarter.
Abbott sees the deal adding to its adjusted earnings in the
first full year after closing. On a per-share basis, Abbott
estimates the buy increasing earning by 21 cents in 2017 and 29
cents in 2018. The companies see sales and operational benefits of
$500 million by 2020.
Write to George Stahl at george.stahl@wsj.com
(END) Dow Jones Newswires
April 28, 2016 07:42 ET (11:42 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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