BD, a global manufacturer of medical supplies, devices, laboratory equipment and diagnostic products, will acquire CareFusion for $12.2 billion in a deal announced on October 5.

San Diego-based CareFusion generated $417 million in net income on $3.84 billion in revenue during fiscal 2014, which ended on June 30. Its products include the Alaris IV pumps and safety software, Pyxis automated medication dispensing systems and bar code systems for patient identification, MedMined infection surveillance system, and AVEA critical care ventilators. The company also sells a variety of patient monitors, supply chain management systems, and medical supplies such as surgical instruments and skin cleansers.

Franklin Lakes, N.J.-based BD, also known as Becton, Dickinson and Company, will pay $58 in a combination of cash and stock for each share of CareFusion stock, which closed on Oct. 3 at $46.17. “BD’s acquisition of CareFusion allows us to align our highly complementary technologies and products to address unmet needs in the growing $20 billion global medication management industry, which leverages BD’s world-wide infrastructure,” said BD Chair and CEO Vincent Forlenza in a statement. The deal also accelerates BD’s transition from a product-focused company to a customer-centric provider of solutions, he added.

CareFusion sees the acquisition as bringing new growth opportunities in a global market and delivering value to shareholders, according to Kieran Gallahue, chair and CEO. BD expects double-digit cash earnings per share accretion in the first full year and has identified $250 million of annual pre-tax cost synergies. These include less overhead expenses and efficiencies from combined operations and manufacturing. CareFusion in the acquisition announcement reaffirmed its fiscal 2015 financial guidance of revenue growth of five to seven percent, and adjusted earnings per share of $2.60 to $2.75.

CareFusion will operate as part of BD’s medical segment and “BD is committed to maintaining an active presence in San Diego where CareFusion is headquartered,” according to the companies.

 

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