Philips to become a global leader in patient care management
solutions for the hospital and the home through the acquisition of
BioTelemetry, Inc.
December 18, 2020
- Philips to acquire BioTelemetry, Inc. for USD 72.00 per share;
implied enterprise value of USD 2.8 billion (approx. EUR 2.3
billion)
- Acquisition is a strong fit with Philips’ strategy to transform
the delivery of healthcare: combination of Philips’ leading patient
monitoring position in the hospital with BioTelemetry’s leading
cardiac diagnostics and monitoring position outside the
hospital
- With 2019 sales of USD 439 million, BioTelemetry annually
monitors over 1 million cardiac patients remotely; its portfolio
includes wearable heart monitors, AI-based data analytics and
services
- Combination will result in significant synergies driven by
cross-selling opportunities, geographical expansion, portfolio
innovation synergies, and productivity gains
- BioTelemetry business is expected to deliver double-digit
growth and improve its Adjusted EBITA margin to over 20% by 2025;
acquisition will be sales growth and adjusted EBITA margin
accretive for Philips in 2021
Amsterdam, the Netherlands – Royal Philips
(NYSE: PHG, AEX: PHIA), a global leader in health technology, and
BioTelemetry, Inc. (NASDAQ: BEAT), a leading U.S.-based provider of
remote cardiac diagnostics and monitoring, today announced that
they have entered into a definitive merger agreement. Pursuant to
the agreement, Philips will commence a tender offer to acquire all
of the issued and outstanding shares of BioTelemetry for USD 72.00
per share, to be paid in cash upon completion. This represents a
16.5 percent premium to BioTelemetry’s closing price on December
17, 2020. The implied enterprise value is USD 2.8 billion
(approximately EUR 2.3 billion), inclusive of BioTelemetry’s cash
and debt. The board of directors of BioTelemetry has approved the
transaction and recommends the offer to its shareholders. The
transaction is expected to be completed in the first quarter of
2021.
The acquisition of BioTelemetry is a strong fit with Philips’
cardiac care portfolio, and its strategy to transform the delivery
of care along the health continuum with integrated solutions. The
combination of Philips’ leading patient monitoring position in the
hospital with BioTelemetry’s leading cardiac diagnostics and
monitoring position outside the hospital, will result in a global
leader in patient care management solutions for the hospital and
the home for cardiac and other patients. Philips’ current portfolio
includes real-time patient monitoring, therapeutic devices,
telehealth and informatics. Moreover, Philips has an advanced and
secure cloud-based Philips HealthSuite digital platform optimized
for the delivery of healthcare across care settings. Every year,
Philips’ integrated solutions monitor around 300 million patients
in hospitals, as well as around 10 million sleep and respiratory
care patients in their own homes.
“The acquisition of BioTelemetry fits perfectly with our
strategy to be a leading provider of patient care management
solutions for the hospital and the home,” said Frans van Houten,
CEO of Royal Philips. “BioTelemetry’s leadership in the large and
fast growing ambulatory cardiac diagnostics and monitoring market
complements our leading position in the hospital. Leveraging our
collective expertise, we will be in an optimal position to improve
patient care across care settings for multiple diseases and medical
conditions.”
“Through continued innovation, we have developed the world’s
largest remote cardiac monitoring services network,” said Joseph H.
Capper, President and CEO of BioTelemetry. “We are delighted to
become part of Philips and continue on our journey to deliver
health information to improve the quality of life and reduce the
cost of care. Combined with Philips’ current patient care
management portfolio, innovation strength and global scale, we are
perfectly equipped to address the rising demand for telehealth and
remote monitoring solutions.”
BioTelemetry primarily focuses on the diagnosis and monitoring
of heart rhythm disorders, representing 85% of its sales.
BioTelemetry’s clinically validated offering includes wearable
heart monitors (e.g. a mobile cardiac outpatient telemetry patch
and extended Holter monitor) that detect and transmit abnormal
heart rhythms wirelessly, AI-based data analytics and services.
With over 30,000 unique referring physicians per month,
BioTelemetry provides services for over one million patients per
year. Additionally, BioTelemetry has a clinical research business
that provides testing services for clinical trials. The total
addressable market is USD 3+ billion, growing high-single-digits
driven by an increasing prevalence of chronic diseases, and the
adoption of remote monitoring and outcome-oriented models.
FinancialsUpon completion of the transaction,
BioTelemetry and its approximately 1,900 employees will become part
of Philips’ Connected Care business segment. The acquisition is
projected to be sales growth and adjusted EBITA margin accretive
for Philips in 2021. Philips targets significant synergies driven
by cross-selling opportunities (especially in the U.S.),
geographical expansion, and portfolio innovation synergies, such as
Philips’ Health Suite digital platform. Additionally, Philips will
drive operational performance improvements through its proven
productivity programs. The BioTelemetry business is expected to
grow double-digits and to improve its Adjusted EBITA margin to more
than 20% by 2025.
TransactionThe transaction is structured as a
cash tender offer by Philips for all of the issued and outstanding
shares of BioTelemetry, to be followed by a merger in which each
share of BioTelemetry not tendered in the tender offer (other than
shares that are held by Philips and certain of its affiliates, and
BioTelemetry) will be converted into the USD 72.00 per share price
paid in the tender offer. Pursuant to the merger agreement, the
transaction is subject to customary closing conditions, including
the expiration or termination of the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976. The tender
offer is not subject to any financing conditions.
For further information, please
contact:
Steve KlinkPhilips Global Press OfficeTel.: +31 6
10888824E-mail: steve.klink@philips.com
Derya GuzelPhilips Investor RelationsTel.: +31 20 59
77055E-mail: derya.guzel@philips.com
About Royal PhilipsRoyal Philips (NYSE: PHG,
AEX: PHIA) is a leading health technology company focused on
improving people's health and well-being, and enabling better
outcomes across the health continuum – from healthy living and
prevention, to diagnosis, treatment and home care. Philips
leverages advanced technology and deep clinical and consumer
insights to deliver integrated solutions. Headquartered in the
Netherlands, the company is a leader in diagnostic imaging,
image-guided therapy, patient monitoring and health informatics, as
well as in consumer health and home care. Philips generated 2019
sales of EUR 19.5 billion and employs approximately 81,000
employees with sales and services in more than 100 countries. News
about Philips can be found at www.philips.com/newscenter.
About BioTelemetryBioTelemetry, Inc. is the
leading remote medical technology company focused on the delivery
of health information to improve quality of life and reduce cost of
care. The company provides remote cardiac monitoring,
centralized core laboratory services for clinical trials, remote
blood glucose monitoring and original equipment manufacturing that
serves both healthcare and clinical research customers. More
information can be found at www.gobio.com.
Important InformationThe tender offer described
in this communication (the “Offer”) has not yet commenced, and this
communication is neither an offer to purchase nor a solicitation of
an offer to sell any shares of the common stock of BioTelemetry or
any other securities. On the commencement date of the Offer, a
tender offer statement on Schedule TO, including an offer to
purchase, a letter of transmittal and related documents, will be
filed with the United States Securities and Exchange Commission
(the “SEC”) by Philips and a Solicitation/Recommendation Statement
on Schedule 14D-9 will be filed with the SEC by BioTelemetry. The
offer to purchase shares of BioTelemetry common stock will only be
made pursuant to the offer to purchase, the letter of transmittal
and related documents filed as a part of the Schedule TO.
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ BOTH THE
TENDER OFFER STATEMENT AND THE SOLICITATION/RECOMMENDATION
STATEMENT REGARDING THE OFFER, AS THEY MAY BE AMENDED FROM TIME TO
TIME, WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION. The tender offer statement will be
filed with the SEC by Davies Merger Sub, Inc., a wholly owned
subsidiary of Philips Holding USA Inc., which is a wholly owned
subsidiary of Royal Philips, and the solicitation/recommendation
statement will be filed with the SEC by BioTelemetry. Investors and
security holders may obtain a free copy of these statements (when
available) and other documents filed with the SEC at the website
maintained by the SEC at www.sec.gov or by directing such requests
to the Information Agent for the Offer, which will be named in the
tender offer statement.
Forward-looking statements This release may
contain certain forward-looking statements with respect to the
financial condition, results of operations and business of Philips
and certain of the plans and objectives of Philips with respect to
these items, including without limitation completion of the Offer
and merger and any expected benefits of the merger, and certain
forward-looking statements regarding BioTelemetry, including
without limitation with respect to its business, the Offer and
merger, the expected timetable for completing the transaction, and
the strategic and other potential benefits of the transaction.
Completion of the Offer and merger are subject to conditions,
including satisfaction of a minimum tender condition and the need
for regulatory approvals, and there can be no assurance that those
conditions can be satisfied or that the transactions described in
this release (the “Transactions”) will be completed or will be
completed when expected. Often, but not always, forward-looking
statements can be identified by the use of words such as “plans,”
“expects,” “expected,” “scheduled,” “estimates,” “intends,”
“anticipates,” “projects,” “potential,” “continues” or “believes,”
or variations of such words and phrases, or by statements that
certain actions, events, conditions, circumstances or results
“may,” “could,” “should,” “would,” “might” or “will” be taken,
occur or be achieved. By their nature, forward-looking statements
involve risk and uncertainty because they relate to events and
depend on circumstances that will occur in the future and there are
many factors that could cause actual results and developments to
differ materially from those expressed or implied by these
forward-looking statements. These factors include, but are not
limited to, (i) the risk that not all conditions of the Offer or
the merger will be satisfied or waived; (ii) uncertainties relating
to the anticipated timing of filings and approvals relating to the
Transactions; (iii) uncertainties as to the timing of the Offer and
merger; (iv) uncertainties as to how many of BioTelemetry’s
stockholders will tender their stock in the Offer; (v) the
possibility that competing offers will be made; (vi) the failure to
complete the Offer or the merger in the timeframe expected by the
parties or at all; (vii) the outcome of legal proceedings that may
be instituted against BioTelemetry and/or others relating to the
Transactions; (viii) the risk that the Transactions disrupt current
plans and operations of BioTelemetry and adversely affect its
ability to maintain relationships with employees, customers, or
suppliers; (ix) the possibility that the parties may be unable to
achieve expected synergies and operating efficiencies within the
expected time-frames or at all and to successfully integrate
BioTelemetry’s operations into those of Philips; (x) the successful
implementation of Philips’ strategy and the ability to realize the
benefits of this strategy; (xi) domestic and global economic and
business conditions; (xii) market and supply chain disruptions due
to the COVID-19 outbreak; (xiii) regulatory developments affecting
Philips’ and or BioTelemetry’s actual or proposed products or
technologies; (xiv) political, economic and other developments in
countries where Philips operates; (xv) unpredictability and
severity of catastrophic events or epidemics, pandemics or similar
public health events (including the COVID-19 outbreak); (xvi)
industry consolidation and competition; (xvii) the
possibility that Philips’ business and/or BioTelemetry’s business
will be adversely impacted during the pendency of the Transactions
and (xviii) other risk factors described in BioTelemetry’s Annual
Report on Form 10-K and Quarterly Reports on Form 10-Q filed with
the SEC. Any forward-looking statements in this release are based
upon information known to Philips on the date of this announcement.
Readers are cautioned not to place undue reliance on any of these
forward-looking statements. These forward-looking statements speak
only as of the date hereof. Neither Philips nor BioTelemetry
undertakes any obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
This press release contains inside information within the
meaning of Article 7(1) of the EU Market Abuse Regulation.
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