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C.R. Bard Shareholders Approve Merger With Becton, Dickinson

Zacks

Murray Hill, NJ-based C. R. Bard, Inc. BCR announced that the majority of its shareholders have approved its merger with Becton, Dickinson and Company BDX. Holders of approximately 99% of C.R. Bard’s shares that participated in the vote favored the merger. Management expects to complete the merger in the fourth quarter of 2017.

The Deal

On Apr 23, Becton, Dickinson, a leading global medical technology company, announced that it will acquire C.R. Bard for $24 billion. The agreement is expected to close in the fourth quarter of 2017. We view the acquisition as a strategic fit which will generate benefits from complementary businesses and geographical expansion.

We believe that the development will provide benefits of medication management and infection prevention to C.R. Bard’s customers and bolster its foothold in the global medical devices market. In this regard, the company has registered more than 500 products internationally in full-year 2016.


Summing Up

The acquisition is expected to strengthen the combined entity’s footprint in the home healthcare market in the U.S. On this note, a research report by ‘Markets and Markets’ reveals that the home healthcare market is expected to reach a total of $349.8 billion by 2020, growing at a CAGR of 9.0%.

However, the combined entity is likely to face some challenges with regard to the integration of the new businesses and the costs associated with them. Apart from this, increased competition, delay in order renewal process and constricted federal spending are other concerns.

Key Picks

Currently, C.R. Bard carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the broader medical sector are Edwards Lifesciences Corporation EW and Dextera Surgical Inc. DXTR.

Notably, Edwards Lifesciences sports a Zacks Rank #1 (Strong Buy), while Dextera has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Edwards Lifesciences has a long-term expected earnings growth rate of 15.2%. Notably, the stock returned 5.9% over the last three months.

Dextera has a projected sales growth of 54.8% for the current year. The stock promises a long-term expected earnings growth rate of 25%.

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