Shares of medical technology company Becton, Dickinson And Company ( BDX ) are trading higher after the company said it will acquire Edwards Lifesciences Corp’s Critical Care product group, an advanced monitoring solutions provider, for $4.2 billion in cash.

Critical Care has approximately 4,500 employees, most of whom are based in Irvine, California. In 2023, the business generated more than $900 million in revenue.

This acquisition is set to enhance BD’s portfolio in smart connected care solutions, providing significant value creation opportunities. The transaction is expected to be immediately accretive to all key financial measures, including revenue growth, adjusted gross and operating margins, and adjusted earnings per share.

Critical Care, serves millions of patients worldwide with its AI-driven algorithms. The company pioneered the hemodynamic monitoring category, and its solutions are currently used in more than 10,000 hospitals globally.

With this agreement, Edwards is no longer pursuing the previously announced spin-off of Critical Care.

Critical Care’s portfolio includes Swan Ganz pulmonary artery catheter, minimally invasive sensors, noninvasive cuffs, tissue oximetry sensors and monitors. 

These technologies are vital in real-time cardiovascular monitoring, particularly for critically ill patients, helping to improve clinical outcomes.

Tom Polen, Chairman, CEO, and President of BD said, “We believe the combination unlocks multiple new avenues for growth and value creation through BD’s broad global footprint, increased penetration across new and existing hospital customers, new innovation opportunities across data sets and platforms, and application of the BD Excellence operating system.”

BD will fund the $4.2 billion all-cash transaction with approximately $1 billion in cash and $3.2 billion in new debt. BD held $2.4 billion in cash and equivalents as of March-end.

The acquisition is expected to close by the end of the year, pending regulatory approvals and customary closing conditions.

Following the acquisition, Critical Care will become a separate business unit within BD’s Medical segment. Katie Szyman, who has led Critical Care since 2015, will continue to oversee the business unit, reporting to Mike Garrison, Executive Vice President and President of BD Medical segment. Critical Care will maintain its operations in Irvine, California.

Price Action: BD shares are trading higher by 2.95% at $238.82 at the last check Monday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.