BD to Acquire Bard for $24 Billion

BD (Becton, Dickinson and Company), a leading global medical technology company, and C. R. Bard, Inc., a medical technology leader in the fields of vascular, urology, oncology and surgical specialty products, announced today a definitive agreement under which BD will acquire Bard for $317.00 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 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 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 healthcare 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 healthcare 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.”

Tim Ring, Bard’s chairman and chief executive officer, said, “We are confident that this combination will deliver meaningful benefits for customers and patients as we see opportunities to leverage BD’s leadership, especially in medication management and infection prevention. We also believe that we can expand our access to customers and patients through BD’s strategic selling capabilities, and that our fast-growing portfolio in emerging markets can significantly benefit from their well-established international commercial infrastructure. Our two companies share the conviction that a product leadership strategy focused on unmet needs and improved outcomes that provide economic value to the global healthcare system will provide long-term shareholder returns.”

John Weiland, Bard’s vice-chairman, president and chief operating officer, added, “BD and Bard share a common purpose with highly compatible organizations. We are very proud of the business and culture we have built over 110 years, focused on quality, integrity, innovation and service. We have long had great respect for BD and find in them a similarly strong, results-oriented culture that prioritizes execution and long-term value creation. In addition to significant benefits for our customers, patients, and shareholders, we believe this combination will provide our employees with new and exciting opportunities as part of a highly competent, dynamic global organization. We look forward to this next chapter in our company’s great history.”

The transaction will create new opportunities to build on BD’s leadership position in medication management and infection prevention with an expanded offering of solutions across the care continuum:

- Will bring together highly complementary product sets to create unmatched solutions for customers, enhancing growth opportunities for the combined company.
- By combining Bard’s strong leadership position and innovation pipeline in fast-growing vascular access segments – PICCs (peripherally inserted central catheters), midlines and drug delivery ports – with BD’s leadership and innovation in IV drug preparation, dispensing, delivery and administration, the new company will be better positioned to provide end-to-end medication management solutions across the care continuum.
- Will further expand BD’s leadership in infection prevention, with offerings positioned to address 75 percent of the most costly and frequent healthcare associated infections (HAIs). Through the combined solutions set, the new company will have a more comprehensive, clinically relevant offering to address Surgical Site Infections (SSIs) and catheter-related bloodstream infections (CRBSIs).
- Bard’s strong product portfolio and innovation pipeline will increase BD’s opportunities in fast growing clinical areas, including peripheral vascular therapy, oncology and bio-surgery.
- Bard’s clinically differentiated offerings will create more meaningful scale and relevance for BD in high-growth categories of oncology and surgery.
-  Bard will expand BD’s focus on the treatment of disease states beyond diabetes to include peripheral vascular disease, urology, hernia and cancer.

BD’s leading global capabilities and infrastructure will further accelerate the combined company’s growth outside of the U.S., creating more opportunities for patients and clinicians around the world to benefit from BD’s and Bard’s product technology.

Together, BD and Bard will bring to market an expanded portfolio of clinically relevant products, with opportunities to drive near-term revenue synergies outside of the U.S.

Bard, which registered approximately 500 products internationally in 2016, has made significant progress expanding outside of the U.S. in recent years, particularly in emerging markets, where Bard is among the fastest growing medical technology companies.

Bard's strong presence in vascular access and surgery will also help drive sales of the highly complementary CareFusion portfolio outside of the U.S.

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

Source: BD