Abbott Laboratories reported that it plans to acquire Cardiovascular Systems Inc., (CSI), maker of an orbital atherectomy system, and will pay shareholders of CSI $20 per share. Analysts see the acquisition as a smart move for Abbott even though the purchase price represents a 50%-plus premium over the Feb. 8 closing price of $13.31 for CSI shares, but the companies did not provide a date by which the transaction will close. The equity value of the agreement is pegged at $890 million while the enterprise value is estimated at $760 million, and while analysts saw the timing of the announcement as a surprise, the deal itself was anything but surprising. Abbott management had previously signaled an intent to make acquisitions that provide a solid fit into the company’s portfolio, a condition which the CSI agreement seems to fulfill, given that Abbott had previously lacked an entry in the atherectomy space. By some estimates, the global market for atherectomy devices will grow by a compound annual growth rate (CAGR) of 7.34% over the remainder of the decade and reach roughly $2 billion by 2030, up significantly from $1.02 billion in 2021. The growing share of the world’s population of those aged 65 and older is the primary driver of this expected growth. CSI had indicated in January 2023 that it would expand its footprint in the central and peripheral vascular disease space, including the completed filing of a market authorization by another company, Innova Vascular Inc. Innova had agreed to CSI’s acquisition of Innova’s technology for thrombectomy, thus solidifying CSI’s value.
To read more on related topics, click on one of the words below.