Abbott Laboratories will buy St. Jude Medical in a $25 billion deal, the largest-ever acquisition by Abbott and one that will merge two of the medical device industry’s leading innovators.
 
Shareholders of Little Canada-based St. Jude will receive $46.75 in cash and 0.8708 shares of Abbott common stock, amounting to a total of approximately $85 per share.
 
Upon news of the deal, St. Jude stock skyrocketed to its highest price on record. Company shares were valued at $79.50 around Thursday morning, a more than 28 percent increase from Wednesday’s closing price of $61.97.
 
The addition of St. Jude technologies will position Abbott Park, Illinois-based Abbott as a top company within the cardiovascular device market, which includes items like pacemakers, defibrillators, and stents. Complimentary strengths from both companies—St. Jude being a leader in heart failure devices, atrial fibrillation and cardiac rhythm management, while Abbott offers products in coronary intervention and transcatheter mitral repair—will reportedly lead to reduced costs with payers and improved negotiating power with hospitals.
 
The purchase could result in job cuts at either or both of the companies as part of cost-cutting measures and to avoid duplication, but personnel plans were not disclosed.
 
“Bringing together these two great companies will … immediately advance Abbott’s strategic and competitive position,” Abbott CEO Miles D. White said in a statement.
 
Abbott also said it has financing to purchase diagnostic device maker Alere Inc. for $5.8 billion, an acquisition that could occur later this year despite a tie-up with regulators and White dismissing questions about the deal last week during Abbott’s first quarter earnings conference call.
 
Both companies’ boards approved the deal and it’s expected to close in the fourth quarter pending regulatory approval.
 
St. Jude was one of 15 Minnesota-based companies ranked in Forbes’ Global 2000 list among the world’s biggest public companies. In 2015, the company reported $5.54 billion in revenue and employed roughly 18,000 workers worldwide.