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Boston Scientific's (BSX) $4.2B Buyout to Augment PI Business
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In sync with efforts to accelerate inorganic growth, Boston Scientific Corporation (BSX - Free Report) announced plans to buy BTG plc on the terms of a recommended offer within the Peripheral Interventions (“PI”) business.
Based in the U.K., BTG markets and develops products that are used in minimally-invasive procedures related to cancer and vascular diseases along with acute care pharmaceuticals. The buyout is expected to be completed in the first half of 2019 on the receipt of required regulatory, BTG's shareholders and the U.K. court approvals.
Financial Terms of the Deal
The transaction, valued at around $4.2 billion, is expected to be paid by using a combination of proceeds from debt financing by Boston Scientific through cash on hand. Moreover, the buyout is expected to be accretive to the company’s adjusted earnings per share in 2019 to the tune of 2-3 cents followed by increasing contributions, thereafter.
A Glimpse of BTG’s Product Suite
The acquisition of BTG is expected to augment Boston Scientific’s PI portfolio, considerably. In this regard, BTG has three primary businesses, of which its Interventional Medicine portfolio including various PI product lines is the largest. The interventional oncology suite encompasses the TheraSphere Y-90 radiotherapy microspheres and the GALIL cryoablation system, which are used to treat liver, kidney and other cancer patients.
Furthermore, BTG’s Interventional Medicine business also boasts a vascular portfolio, including filters, crossing catheters, microfoam and the EKOS Endovascular System.
Market Potential
According to a Global Cancer Observatory database,more than 840,000 people are expected to be diagnosed with liver cancer in 2018, which will reach 1.1 million by 2030. Also, per statistics provided by American Cancer Society, kidney cancer is considered to be among the 10 most common cancers in men and women. Considering the data, the acquisition is believed to be a prudent one.
Other Acquisitions in Focus
We are impressed with Boston Scientific’s recent acquisitions that have added numerous products (though many are undergoing development) with immense potential. This in turn will boost the top line over the long term. During the last reported quarter, the company closed three prospective tuck-in acquisitions which are Claret Medical, VENITI and Augmenix.
These acquisitions all target high-growth markets, enhance the company’s category leadership strategy, leverage existing local capabilities and further enhance its short-term and long-term growth profile. Augmenix acquisition enhances the company’s category leadership strategy in Urology. Meanwhile, the integration of Claret Medical will broaden the company’s structural heart portfolio. Other important tuck-in acquisitions of 2018 are Cryterion, nVision, and Securus.
Previously, the company announced acquisitions of NxThera and nVision in Urology and Pelvic Health, EmCision in Endoscopy, Securus in EP as well as Millipede in Structural Heart. According to Boston Scientific, these acquisitions represent expansion opportunities worth more than $16 billion in prospective and new markets by 2021.
Price Performance
Shares of Boston Scientific have outperformed its industry in a year’s time. The stock has returned 18.3%, against the industry’s 2.4% decline.
Zacks Rank & Key Picks
Boston Scientific currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the broader medical space are Stryker Corporation (SYK - Free Report) , Illumina, Inc. (ILMN - Free Report) and Veeva Systems (VEEV - Free Report) .
Illumina’s long-term earnings growth rate is projected at 23.4%. The stock carries a Zacks Rank #2.
Veeva Systems’ long-term earnings growth rate is estimated at 19.3%. The stock carries a Zacks Rank #2.
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Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
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Boston Scientific's (BSX) $4.2B Buyout to Augment PI Business
In sync with efforts to accelerate inorganic growth, Boston Scientific Corporation (BSX - Free Report) announced plans to buy BTG plc on the terms of a recommended offer within the Peripheral Interventions (“PI”) business.
Based in the U.K., BTG markets and develops products that are used in minimally-invasive procedures related to cancer and vascular diseases along with acute care pharmaceuticals. The buyout is expected to be completed in the first half of 2019 on the receipt of required regulatory, BTG's shareholders and the U.K. court approvals.
Financial Terms of the Deal
The transaction, valued at around $4.2 billion, is expected to be paid by using a combination of proceeds from debt financing by Boston Scientific through cash on hand. Moreover, the buyout is expected to be accretive to the company’s adjusted earnings per share in 2019 to the tune of 2-3 cents followed by increasing contributions, thereafter.
A Glimpse of BTG’s Product Suite
The acquisition of BTG is expected to augment Boston Scientific’s PI portfolio, considerably. In this regard, BTG has three primary businesses, of which its Interventional Medicine portfolio including various PI product lines is the largest. The interventional oncology suite encompasses the TheraSphere Y-90 radiotherapy microspheres and the GALIL cryoablation system, which are used to treat liver, kidney and other cancer patients.
Furthermore, BTG’s Interventional Medicine business also boasts a vascular portfolio, including filters, crossing catheters, microfoam and the EKOS Endovascular System.
Market Potential
According to a Global Cancer Observatory database,more than 840,000 people are expected to be diagnosed with liver cancer in 2018, which will reach 1.1 million by 2030. Also, per statistics provided by American Cancer Society, kidney cancer is considered to be among the 10 most common cancers in men and women. Considering the data, the acquisition is believed to be a prudent one.
Other Acquisitions in Focus
We are impressed with Boston Scientific’s recent acquisitions that have added numerous products (though many are undergoing development) with immense potential. This in turn will boost the top line over the long term. During the last reported quarter, the company closed three prospective tuck-in acquisitions which are Claret Medical, VENITI and Augmenix.
These acquisitions all target high-growth markets, enhance the company’s category leadership strategy, leverage existing local capabilities and further enhance its short-term and long-term growth profile. Augmenix acquisition enhances the company’s category leadership strategy in Urology. Meanwhile, the integration of Claret Medical will broaden the company’s structural heart portfolio. Other important tuck-in acquisitions of 2018 are Cryterion, nVision, and Securus.
Previously, the company announced acquisitions of NxThera and nVision in Urology and Pelvic Health, EmCision in Endoscopy, Securus in EP as well as Millipede in Structural Heart. According to Boston Scientific, these acquisitions represent expansion opportunities worth more than $16 billion in prospective and new markets by 2021.
Price Performance
Shares of Boston Scientific have outperformed its industry in a year’s time. The stock has returned 18.3%, against the industry’s 2.4% decline.
Zacks Rank & Key Picks
Boston Scientific currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the broader medical space are Stryker Corporation (SYK - Free Report) , Illumina, Inc. (ILMN - Free Report) and Veeva Systems (VEEV - Free Report) .
Stryker has a long-term expected earnings growth rate of 10% and a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Illumina’s long-term earnings growth rate is projected at 23.4%. The stock carries a Zacks Rank #2.
Veeva Systems’ long-term earnings growth rate is estimated at 19.3%. The stock carries a Zacks Rank #2.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>