Merit Medical to pay $100m for Bard, BD biopsy assets

Merit Medical (NSDQ:MMSI) said today that it agreed to pay $100 million for soft tissue biopsy assets Becton Dickinson (NYSE:BDX) and C.R. Bard (NYSE:BCR) need to sell to consummate their $24 billion merger.

The deal covers BD’s Achieve and Temno biopsy systems and Tru-Cut biopsy needles, plus Bard’s Aspira pleural effusion drainage and peritoneal drainage systems, South Jordan, Utah-based Merit said.

“We believe this is a perfect fit for Merit,” chairman & CEO Fred Lampropoulos said in prepared remarks. “These products are well established with an installed base and complement Merit’s CorVocet full core biopsy system and our recently-acquired bone biopsy products.

“There are also a number of markets in which Merit has direct representation that will be expanded to include the acquired products, as well as new markets which we plan to develop,” Lampropoulos said. “In summary, we believe this transaction will provide complementary high-margin products, increased use of our existing facilities, market expansion opportunities, accretive margins, profits and our existing sales force utilization.”

“Today’s announcement of our intent to divest two product lines is another step forward in the regulatory review process of BD’s planned acquisition of Bard,” added BD chairman & CEO Vincent Forlenza. “We continue to expect that the BD and Bard transaction will close in the fourth calendar quarter of 2017, subject to customary closing conditions and additional regulatory approvals, including the U.S. Federal Trade Commission and other regulatory bodies.”

Merit said it plans to finance the acquisitions with an existing credit revolver. The biopsy assets are expected to add $42 million to $48 million in annual revenues and 10¢ to 19¢ in adjusted earnings per share during fiscal 2018.

In September BD and Bard agreed to unspecified concessions to address European anti-trust concerns, after Bard shareholders overwhelmingly approved the $24 billion merger in August. The $317-per-share deal, which was announced last April, is expected to close during the fourth quarter, the companies have said. In June, the FTC asked for more information on the merger, adding 30 days to the timeline for closing the deal.

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