Abbott Buys St. Jude Medical for $25 Billion, Gaining More Muscle in Cardiovascular Device Arena
In a deal announced yesterday, Abbott Laboratories is buying St. Jude Medical for $25 billion. The deal, which was rumored to be in the works since last August, will see St. Jude Medical shareholders receive $85 per share.
With the high-profile acquisition, Abbott boosts its medical device repertoire, acquiring devices for the treatment and/or management of valve disease, heart failure, atrial fibrillation, and other cardiac arrhythmias. One financial analyst told Bloomberg that Abbott had an “obvious hole in the medical device business, particular around cardiovascular products, and St. Jude is the perfect fit to fill that gap.”
The Wall Street Journal reports the deal allows Abbott to better compete with rivals Medtronic and Boston Scientific.
In a press release, the companies stated that medical devices are needed to address the “growing health and economic burden of cardiovascular disease,” especially because more than 40% of US adults are expected to have some form of cardiovascular disease by 2030.
In addition to the cardiovascular product line, Abbott gains St. Jude’s neuromodulation devices for the management of chronic pain.
Earlier this year, Abbott agreed to acquire Alere, a maker of diagnostic tests, for $5.8 billion but that deal was complicated when Alere announced it was under investigation by the US Department of Justice for their sales practices. Alere announced today that Abbott attempted to terminate the merger with the company—by paying up to $50 million to end the deal—but that offer was rejected.
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Abbott to acquire St. Jude Medical [press release]. http://abbott.mediaroom.com/2016-04-28-Abbott-to-Acquire-St-Jude-Medical. Published April 28, 2016. Accessed April 29, 2016.
Abbott to buy St. Jude Medical in deal valued at about $25 billion. http://www.bloomberg.com/news/articles/2016-04-28/abbott-agrees-to-buy-st-jude-medical-for-25-billion. Published April 28, 2016. Accessed April 29, 2016.
Alere says it rejected Abbott offer to terminate merger deal. http://www.wsj.com/articles/alere-says-it-rejected-abbott-offer-to-terminate-merger-deal-1461907411. Published April 29, 2016. Accessed April 29, 2016.