BD and CareFusion have announced a definitive agreement under which BD will acquire CareFusion for $58.00 per share in cash and stock, or a total of $12.2 billion, to create a global leader in medication management and patient safety solutions.
About a year ago we were covering the story that CareFusion had made its eighth acquisition in three years, having agreed to buy Vital Signs. Now the boot’s on the other foot as Franklin Lakes, N.J.-based BD is to bolt on CareFusion in a deal that it says will give it a leg-up in its effort to change its business model. The resultant product portfolio will address the full spectrum of medication management, the combination of the two companies’ complementary product portfolios offering integrated medication management solutions and smart devices, from drug preparation in the pharmacy, to dispensing on the hospital floor, administration to the patient, and subsequent monitoring. BD describes this as a $20 billion business.
CareFusion’s products include infusion pumps, IV connectors, surgical site preparations and data-mining tools for quality improvement. On closure of the deal, CareFusion will likely become part of BD’s medical segment, and BD Chief Operating Officer William Kozy has been assigned to lead the integration.
The boards of both companies have approved definitive agreement, which is subject to shareholder approval and regulatory review. The companies said they expect the deal to close in the first half of 2015.
BD secured $9.1 billion in bridge financing from Goldman Sachs to fund the transaction. BD shareholders would own about 92% of the combined company and CareFusion shareholders would own the rest.
“It accelerates BD’s transition from a product-focused company to a customer-centric provider of innovative healthcare solutions with leading scale across the medication management value chain and expanded solutions for patient safety,” said BD CEO Vincent Florenza.
Kieran T. Gallahue, CareFusion Chairman and Chief Executive Officer, said, “As part of BD, we see new growth opportunities for our products in global markets, new value we can create for our customers and new opportunities for our employees as part of what will become one of the largest, global leaders in med-tech. The transaction delivers attractive value for CareFusion shareholders, and represents a powerful endorsement of our strong positions in medication management, informatics across our device platforms and leading products to help improve the effectiveness of acute-care procedures.”