St. Jude Medical To Acquire Heart Therapy Company For $3.4B
St. Jude Medical’s board approved a $3.4 billion purchase on Wednesday of heart failure therapy company Thoratec.
Outstanding shares of California-based Thoratec will be purchased for $63.50 each, without interest, by the Little Canada-based company. The all-cash transaction represents a 40 percent premium over Thoratec’s 30-day average trading price.
“By combining the capabilities and leading technologies of both companies, we will be able to expand access, reduce costs and advance heart failure therapies on a global basis,” Thoratec’s president and CEO, D. Keith Grossman, said in a statement. “It is gratifying to see the creation of a combined product platform and capability with St. Jude Medical that will fulfill the promise of our products to many, many more patients in the years to come.”
The merger of these medical company’s product lines will culminate in “the most comprehensive portfolio of products for the management and treatment of heart failure” in the world, St. Jude said.
Thoratec’s position in the ventricular assist device market is valued to be worth $750 million, however the company recently announced approval of a percutaneous heart pump that should fetch more than $300 million in 2016, bringing the portfolio to more than $1 billion. St. Jude projects to grow 10 percent annually with Thoratec under its wing.
Additionally, St. Jude released its second quarter results ending July 4. Net sales dropped 3 percent compared to the prior year quarter, ending in $1.41 billion in total sales. St. Jude anticipates its full-year results to rise 4 to 6 percent.
“We remain confident in our key programs,” St. Jude CEO Daniel J. Starks said in a statement. “We are raising our sales guidance in order to demonstrate our strong outlook for the remainder of the year.”