McKesson Corporation (MCK - Free Report) recently announced that it has completed its previously announced acquisition of PSS World Medical, Inc.
McKesson paid $2.1 billion for the acquisition including PSS World Medical's debt of about $480 million and related transaction costs. The acquisition was announced on Oct 25, 2012.
In Dec 2012, McKesson received a notification of early termination of the waiting period under the Hart-Scott Rodino Antitrust Improvements Act of 1976, in relation with its proposed acquisition of erstwhile PSS World Medical Inc.
At the time of announcing the acquisition, McKesson had said that it expects to generate more than $100 million in annual savings (pre-tax) by the fourth year after the closure of the deal. The deal acquisition is expected to add 15 to 25 cents per share to the company's bottom line after a year of closing.
McKesson recently lowered its earnings guidance range for fiscal 2013. The company now expects earnings (excluding special items) in the range of $7.10–$7.30 per share (previous projection: $7.15–$7.35 share).
The erstwhile PSS World Medical will be combined with McKesson’s Medical Surgical Distribution business. The addition of PSS World Medical to the company’s product line will bolster the Medical Surgical Distribution business of McKesson.
We note that McKesson has been quite active on the acquisition front recently. In Nov 2012, the company inked a deal with Emendo Ltd. to acquire the latter.
McKesson currently carries a Zacks Rank #3 (Hold). Nevertheless, stocks like AmerisourceBergen (ABC - Free Report) , Cardinal Health (CAH - Free Report) and CVS Caremark Corporation (CVS - Free Report) which operate in the same sector as McKesson, currently look attractive with a Zacks Rank #2 (Buy).