Abbott wins US antitrust approval for $25B St. Jude buy

The US Federal Trade Commission today granted approval to Abbott (NYSE:ABT) to complete its proposed $25 billion acquisition of St. Jude Medical (NYSE:STJ).

The approval came with a caveat that the companies divest themselves of 2 cardiovascular medical device businesses – vascular closure devices and “steerable” sheaths.

The hurdle shouldn’t be too difficult for the companies, who have already arranged to sell off those specific cardiovascular assets to Terumo (TYO:4543) for approximately $1 billion.

The FTC said the divestiture would be required to keep the acquisition from causing “significant harm to competition in these 2 markets.”

The agency further ordered Abbott to notify it if it acquired lesion-assessing ablation catheter assets from Advanced Cardiac Therapeutics. Only St. Jude and 1 other company produce such technology, the FTC warned, and an acquisition of a new developer in the field could further eliminate additional competition.

The commission said its consent agreement on the matter will be open to public comment for 30 days before it decides whether or not to make it final.

Earlier this month, anti-trust regulators in India cleared the $25 billion tie-up.

In a Dec. 16 Twitter message, the Competition Committee of India said it “approves proposed combination between St Jude Medical and Abbott Laboratories; subject to voluntary remedies.”

Although the exact “voluntary remedies” required by CCI weren’t made clear, last month the European Commission’s decision on the deal required the divestiture of a pair of device lines: St. Jude must deal its Angio-Seal and Femoseal vascular closure assets, including a manufacturing plant in Puerto Rico, and Abbott must deal the Vado steerable sheath it bought with the acquisition of Kalila Medical earlier this year. Both assetts are slated to go to Terumo in their $1 billion deal.

The Indian approval came a handful of weeks after regulators in Europe cleared the deal.

Abbott has said it plans to pay for the deal with cash on hand and a $15.1 billion debt offering. The Abbott Park, Ill.-based healthcare giant floated $2.85 billion in 2.35% senior notes due in 2019; $2.85 billion in 2.9% notes due 2021; $1.5 billion in 3.4% notes due 2023; $3.0 billion in 3.75% notes due 2026; $1.65 billion in 4.75% notes due 2036; and $3.25 billion in 4.9% notes due 2046.

If the deal doesn’t go through by the end of next year, Abbott would have to redeem the 2019, 2023, 2026, 2036 and 2046 notes, but not the 2021 notes at a 101% premium plus interest, according to a regulatory filing.

Material from Reuters was used in this report.

The post Abbott wins US antitrust approval for $25B St. Jude buy appeared first on MassDevice.

from MassDevice http://ift.tt/2ibzuTa