FRANKLIN LAKES, N.J. and
MURRAY HILL, N.J., April 23, 2017 /PRNewswire/ -- BD (Becton,
Dickinson and Company) (NYSE: BDX), a leading global medical
technology company, and C. R. Bard, Inc. (NYSE: BCR), a medical
technology leader in the fields of vascular, urology, oncology and
surgical specialty products, announced today a definitive agreement
under which BD will acquire Bard for $317.00 per Bard common share in cash and stock,
for a total consideration of $24
billion. The agreement has been unanimously approved by the
Boards of Directors of both companies.
The combination will create a highly differentiated medical
technology company uniquely positioned to improve both the process
of care and the treatment of disease for patients and healthcare
providers. The transaction will build on BD's leadership position
in medication management and infection prevention with an expanded
offering of solutions across the care continuum. Additionally,
Bard's strong product portfolio and innovation pipeline will
increase BD's opportunities in fast-growing clinical areas, and the
combination will enhance growth opportunities for the combined
company in non-U.S. markets.
This financially compelling transaction will be immediately
accretive and is expected to generate high-single digit accretion
to adjusted earnings per share (EPS) in fiscal year 2019.
Approximately $300 million of
estimated annual, pre-tax, run-rate cost synergies are expected by
fiscal year 2020. Separately, BD also expects to benefit from
revenue synergies beginning in fiscal year 2019. The transaction is
expected to improve BD's gross margins by approximately 300 basis
points in fiscal year 2018, increase BD's earnings per share growth
trajectory to the mid-teens, and generate strong cash flow.
Vince Forlenza, BD's chairman and
chief executive officer, said, "Combining with Bard will accelerate
our ability to offer more comprehensive, clinically relevant
solutions to customers and patients around the globe, creating a
strong partner for healthcare providers who are increasingly
focused on delivering better outcomes at a lower total cost. Our
two purpose-driven organizations are well-aligned strategically,
sharing a strong track record of performance and a deep commitment
to addressing unmet needs in today's challenging healthcare
environment. We expect the transaction to contribute meaningfully
to BD's plans for revenue growth and margin expansion, and generate
outstanding value both near- and long-term for shareholders.
I am excited to welcome Bard's talented employees to our strong and
dedicated team as we bring together two companies with such
complementary capabilities, values and strong reputations for
delivering superior results."
Tim Ring, Bard's chairman and
chief executive officer, said, "We are confident that this
combination will deliver meaningful benefits for customers and
patients as we see opportunities to leverage BD's leadership,
especially in medication management and infection prevention.
We also believe that we can expand our access to customers and
patients through BD's strategic selling capabilities, and that our
fast-growing portfolio in emerging markets can significantly
benefit from their well-established international commercial
infrastructure. Our two companies share the conviction that a
product leadership strategy focused on unmet needs and improved
outcomes that provide economic value to the global healthcare
system will provide long-term shareholder returns."
John Weiland, Bard's
vice-chairman, president and chief operating officer, added, "BD
and Bard share a common purpose with highly compatible
organizations. We are very proud of the business and culture
we have built over 110 years, focused on quality, integrity,
innovation and service. We have long had great respect
for BD and find in them a similarly strong, results-oriented
culture that prioritizes execution and long-term value
creation. In addition to significant benefits for our
customers, patients, and shareholders, we believe this combination
will provide our employees with new and exciting opportunities as
part of a highly competent, dynamic global organization. We
look forward to this next chapter in our company's great
history."
Strategic Highlights
Will create new opportunities to build on BD's leadership
position in medication management and infection prevention with an
expanded offering of solutions across the care
continuum.
- Will bring together highly complementary product sets to create
unmatched solutions for customers, enhancing growth opportunities
for the combined company.
- By combining Bard's strong leadership position and innovation
pipeline in fast-growing vascular access segments – PICCs
(peripherally inserted central catheters), midlines and drug
delivery ports – with BD's leadership and innovation in IV drug
preparation, dispensing, delivery and administration, the new
company will be better positioned to provide end-to-end medication
management solutions across the care continuum.
- Will further expand BD's leadership in infection prevention,
with offerings positioned to address 75 percent of the most costly
and frequent healthcare associated infections (HAIs). Through the
combined solutions set, the new company will have a more
comprehensive, clinically relevant offering to address Surgical
Site Infections (SSIs) and Catheter-Related Blood Stream Infections
(CRBSIs).
Bard's strong product portfolio and innovation pipeline
will increase BD's opportunities in fast growing clinical areas,
including peripheral vascular therapy, oncology and
bio-surgery.
- Bard's clinically differentiated offerings create more
meaningful scale and relevance for BD in high-growth categories of
oncology and surgery.
- Bard will expand BD's focus on the treatment of disease states
beyond diabetes to include peripheral vascular disease, urology,
hernia and cancer.
BD's leading global capabilities and infrastructure will
further accelerate the combined company's growth outside of the
U.S., creating more opportunities for patients and clinicians
around the world to benefit from BD's and Bard's product
technology.
- Together, BD and Bard will bring to market an expanded
portfolio of clinically relevant products, with opportunities to
drive near-term revenue synergies outside of the U.S.
-
- Bard, which registered approximately 500 products
internationally in 2016, has made significant progress expanding
outside of the U.S. in recent years, particularly in emerging
markets, where Bard is among the fastest growing medical technology
companies.
- Bard's strong presence in vascular access and surgery will also
help drive sales of the highly complementary CareFusion portfolio
outside of the U.S.
- The combined company will have a large and growing presence in
emerging markets, including $1
billion in annual revenue in China.
Transaction Highlights
Under the terms of the transaction, Bard common shareholders
will be entitled to receive approximately $222.93 in cash and 0.5077 shares of BD stock per
Bard share, or a total of value of $317.00 per Bard common share based on BD's
closing price on April 21, 2017. At
closing, Bard shareholders will own approximately 15 percent of the
combined company.
BD expects to contribute approximately $1.7 billion of available cash to fund the
transaction, along with, subject to market conditions,
approximately $10 billion of new debt
and approximately $4.5 billion of
equity and equity linked securities issued to the market. Bard
shareholders will also receive $8
billion of BD common stock. BD has also obtained fully
committed bridge financing. At closing, BD estimates the combined
company will have pro forma leverage of approximately 4.7x and is
committed to deleveraging to below 3.0x leverage within three years
of closing. BD expects to continue the suspension of its share
repurchase program. BD is also committed to annual dividend
increases while reinvesting in the business to continue to drive
long-term growth.
The transaction is subject to regulatory and Bard shareholder
approvals and customary closing conditions, and is expected to
close in the fall of 2017.
Integration Plans
BD has a successful integration track record, as demonstrated by
its 2015 acquisition and integration of CareFusion. BD has put in
place a plan to ensure a seamless integration with Bard. A
designated integration team, comprised of senior members of both
organizations, will be led by Bill
Tozzi, a seasoned BD executive who most recently served as
worldwide president of the Medication and Procedural Solutions
business and earlier was corporate controller for BD. At the
closing of the transaction, Tim
Ring, chairman and chief executive of Bard, and an
additional Bard director, are expected to join the BD Board of
Directors, which will be expanded by two directors. BD is
confident in its ability to achieve synergies as it brings together
two world class companies and expects to offer opportunities for
talented employees to become part of an even more dynamic global
leader.
BD Organizational Update
BD expects to create a third segment within the company – BD
Interventional — where the Bard businesses will report both
operationally and financially. BD is separately announcing today
the appointment of Tom Polen, 43,
currently executive vice president and president of the BD Medical
Segment, as president of BD, effective immediately. In his new
role, Mr. Polen will oversee BD's Medical and Life Sciences
segments, as well as the new Interventional segment.
Transaction Conference Call and Webcast Information
BD and Bard will conduct a live conference call and webcast on
April 24, 2017 at 8:00 a.m. (ET). The webcast of the
conference call, along with related slides, will be accessible
through BD's and Bard's websites. The conference call will also be
available for replay through BD's and Bard's websites, or at (800)
585-8367 (domestic) and (404) 537-3406 (international) through the
close of business on May 1, 2017,
confirmation number 13011331.
BD Earnings Update
BD's earnings conference call, previously scheduled for
Thursday, May 4, 2017, has been
rescheduled for Tuesday, May 2, 2017,
at 8:00 a.m. (ET). BD will
issue a press release detailing the quarter's earnings earlier that
morning. The webcast of the conference call, along with
related slides, will be accessible through BD's website at
www.BD.com/investors and will be available for replay through
Thursday, May 9, 2017.
Bard Earnings Update
Bard separately today announced first quarter 2017 financial
results, which are available on Bard's corporate website, and is
canceling the previously scheduled earnings conference call on
April 26, 2017.
Advisors
Perella Weinberg Partners LP is acting as lead financial advisor
to BD. Citi is also serving as a financial advisor to BD and will
be providing fully committed financing. Skadden, Arps, Slate,
Meagher & Flom LLP provided legal counsel to BD. Goldman, Sachs
& Co. served as financial advisor to Bard. Wachtell,
Lipton, Rosen & Katz served as legal advisor to Bard.
About BD
BD is a global medical technology company that is advancing the
world of health by improving medical discovery, diagnostics and the
delivery of care. BD leads in patient and health care worker safety
and the technologies that enable medical research and clinical
laboratories. The company provides innovative solutions that help
advance medical research and genomics, enhance the diagnosis of
infectious disease and cancer, improve medication management,
promote infection prevention, equip surgical and interventional
procedures, and support the management of diabetes. The company
partners with organizations around the world to address some of the
most challenging global health issues. BD has nearly 50,000
associates across 50 countries who work in close collaboration with
customers and partners to help enhance outcomes, lower health care
delivery costs, increase efficiencies, improve health care safety
and expand access to health. For more information on BD, please
visit bd.com.
About C. R. Bard, Inc.
C. R. Bard, Inc. (www.crbard.com), headquartered in Murray Hill, NJ, is a leading multinational
developer, manufacturer and marketer of innovative, life-enhancing
medical technologies in the fields of vascular, urology, oncology
and surgical specialty products.
FORWARD-LOOKING STATEMENTS
This press release contains certain estimates and other
"forward-looking statements" within the meaning of the federal
securities laws, including Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. Forward looking statements generally are
accompanied by words such as "will", "expect", "outlook"
"anticipate," "intend," "plan," "believe," "seek," "see," "will,"
"would," "target," or other similar words, phrases or expressions
and variations or negatives of these words. Forward-looking
statements by their nature address matters that are, to different
degrees, uncertain, such as statements regarding the estimated or
anticipated future results of BD, and of the combined company
following BD's proposed acquisition of Bard, the anticipated
benefits of the proposed combination, including estimated
synergies, the expected timing of completion of the transaction and
other statements that are not historical facts. These
statements are based on the current expectations of BD and Bard
management and are not predictions of actual
performance.
These statements are subject to a number of risks and
uncertainties regarding BD and Bard's respective businesses and the
proposed acquisition, and actual results may differ
materially. These risks and uncertainties include, but are
not limited to, (i) the ability of the parties to successfully
complete the proposed acquisition on anticipated terms and timing,
including obtaining required shareholder and regulatory approvals,
anticipated tax treatment, unforeseen liabilities, future capital
expenditures, revenues, expenses, earnings, synergies, economic
performance, indebtedness, financial condition, losses, future
prospects, business and management strategies for the management,
expansion and growth of the new combined company's operations and
other conditions to the completion of the acquisition, (ii) risks
relating to the integration of Bard's operations, products and
employees into BD and the possibility that the anticipated
synergies and other benefits of the proposed acquisition will not
be realized or will not be realized within the expected timeframe,
(iii) the outcome of any legal proceedings related to the proposed
acquisition, (iv) access to available financing including for the
refinancing of BD's or Bard's debt on a timely basis and reasonable
terms, (v) the ability to market and sell Bard's products in new
markets, including the ability to obtain necessary regulatory
product registrations and clearances, (vi) the loss of key senior
management or other associates; the anticipated demand for BD's and
Bard's products, including the risk of future reductions in
government healthcare funding, changes in reimbursement rates or
changes in healthcare practices that could result in lower
utilization rates or pricing pressures, (vii) the impact of
competition in the medical device industry, (viii) the risks of
fluctuations in interest or foreign currency exchange rates, (ix)
product liability claims, (x) difficulties inherent in product
development, including the timing or outcome of product development
efforts, the ability to obtain regulatory approvals and clearances
and the timing and market success of product launches, (xi) risks
relating to fluctuations in the cost and availability of raw
materials and other sourced products and the ability to maintain
favorable supplier arrangements and relationships, (xii) successful
compliance with governmental regulations applicable to BD, Bard and
the combined company, (xiii) changes in regional, national or
foreign economic conditions, (xiv) uncertainties of litigation, and
(xv) other factors discussed in BD's and Bard's respective filings
with the Securities and Exchange Commission.
The forward-looking statements in this document speak only as of
date of this document. BD and Bard undertake no obligation to
update any forward-looking statements to reflect events or
circumstances after the date hereof, except as required by
applicable laws or regulations.
IMPORTANT INFORMATION FOR INVESTORS
In connection with the proposed transaction, BD will file with
the SEC a registration statement on Form S−4 that will constitute a
prospectus of BD and include a proxy statement of Bard. BD and Bard
also plan to file other relevant documents with the SEC regarding
the proposed transaction. INVESTORS ARE URGED TO READ THE PROXY
STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED WITH THE
SEC IF AND WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION. You may obtain a free copy of the proxy
statement/prospectus (if and when it becomes available) and other
relevant documents filed by BD and Bard with the SEC at the SEC's
website at www.sec.gov. In addition, you will be able to
obtain free copies of these documents by phone, e−mail or written
request by contacting the investor relations department of BD or
Bard at the following:
Becton, Dickinson and
Company
|
C.R. Bard,
Inc.
|
1 Becton
Drive
|
730 Central
Avenue
|
Franklin Lakes, New
Jersey 07417
|
Murray Hill, New
Jersey 07974
|
Attn: Investor
Relations
|
Attn: Investor
Relations
|
1-(800)-284-6845
|
1-908-277-8065
|
PARTICIPANTS IN THE SOLICITATION
BD and Bard and their respective directors and executive
officers and other members of management and employees may be
deemed to be participants in the solicitation of proxies in respect
of the proposed transaction. Information about BD's directors and
executive officers is available in BD's proxy statement dated
December 15, 2016, for its 2017
Annual Meeting of Shareholders. Information about Bard's
directors and executive officers is available in Bard's proxy
statement dated March 15, 2017, for
its 2017 Annual Meeting of Stockholders. Other information
regarding the participants in the proxy solicitation and a
description of their direct and indirect interests, by security
holdings or otherwise, will be contained in the proxy
statement/prospectus and other relevant materials to be filed with
the SEC regarding the acquisition when they become available.
Investors should read the proxy statement/prospectus carefully when
it becomes available before making any voting or investment
decisions. You may obtain free copies of these documents from
BD or Bard as indicated above.
NO OFFER OR SOLICITATION
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the U.S.
Securities Act of 1933, as amended.
BD
Monique Dolecki, Investor Relations
– (201) 847-5378
Kristen Cardillo, Corporate
Communications – (201) 847-5657
Bard
Todd W. Garner, Investor Relations –
(908) 277-8065
Scott T. Lowry, Media Relations –
(908) 277-8365
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/bd-to-acquire-bard-for-24-billion-300443955.html
SOURCE BD (Becton, Dickinson and Company)