AngioDynamics details $372M Navilyst buyout details | Wall Street Beat

February 8, 2012 By MassDevice staff

Financial projections from AngioDynamics (NSDQ:ANGO) about its $372 million deal to acquire Navilyst Medical show that it expects to reap some significant rewards from the merger over the short and long terms.

The deal for the vascular device business spun out by Boston Scientific (NYSE:BSX) in 2008 to Avista Capital Partners is expected to close by the end of May, is forecast to add 8 cents to AngioDynamics’ bottom line during fiscal 2013, according to an SEC filing.

The combined entity will throw off at least $50 million in free cash flow during FY2013, according to the filing, which begins June 1. Although net sales have declined some 4.5% since 2009, to an estimated $149 million last year, the driver of that decline – its fluid management business – is "expected to be stable in FY13 and return to modest growth in FY14, led by increased international penetration,” according to the filing.

And run-rate earnings before interest, depreciation, taxes and amortization are slated to reach $70 million during FY2013, excluding the $3 million impact of the medical device tax and including the $6 million AngioDynamics expects to generate in annual savings from the merger.

AngioDynamics said it expects to post sales of about $360 million for fiscal 2013.

“This is a complete deal that, by merging these competitors which are very alike and very similar, but also have very different and complementary strengths and weaknesses, it’s a way to have a refresh for the entire combined company," CEO Joe DeVivo told MassDevice the day after the deal was struck.

Wall Street, however, seemed unimpressed by the new numbers. ANGO shares were down 2.2% to $12.99 as of about 2 p.m. today, after spiking to $14.80 the day the deal was announced.

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Analysts’ ups and downs

Abiomed (NSDQ:ABMD): Jefferies maintains "buy" rating, $25 price target.
Cerner (NSDQ:CERN): Credit Suisse raises estimates, price target to $72, maintains "neutral" rating.
Sirona (NSDQ:SIRO): Morgan Stanley raises price target to $54, sets "overweight" rating.
Steris (NYSE:STE): JMP Securities downgrades to "market perform."
St. Jude Medical (NYSE:STJ): Barclays Capital maintains “overweight” rating, $48 price target; Leerink Swann sets “outperform” rating, $49 target.
Volcano (NSDQ:VOLC): Goldman Sachs raises estimates, price target to $28 through 2015, maintains "neutral" rating.

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