BD (NYSE: BDX) and Waters Corporation (NYSE:WAT) today announced a definitive agreement to create a new life science and diagnostics leader through a business combination.
The deal seeks to combine BD’s Biosciences & Diagnostic Solutions business with Waters. Structured as a tax-efficient Reverse Morris Trust transaction, the companies value the deal at approximately $17.5 billion.
BD first announced its intent to sell the business unit in February of this year. Reports in April pegged diagnostics leaders Thermo Fisher and Danaher as potential landing spots, also mentioning Waters in the mix.
Today, the companies say they have a deal that brings together complementary technologies serving high-volume testing. The deal combines best-in-class liquid chromatography, mass spectometry, flow cytometry and diagnostic solutions. The companies say it doubles Waters’ total addressable market to approximately $40 billion.
According to BD, its unit can expand Waters’ bioseparations portfolio, combining Waters’ chemistry expertise and BD’s biologics expertise. The company expects to bring regulatory expertise and an established presence in the clinical and diagnostics settings.
BD and Waters expect the transaction to create approximately $200 million in cost synergies by year three post-closing. By year five, they expect $290 million in revenue synergies, resulting in approximately $345 million of annualized EBITDA synergies by 2030.
The transaction is expected to close around the end of the first quarter of calendar year 2026.
Executive commentary from BD and Waters officials
Dr. Flemming Ornskov, chair, Waters, said:
“This transaction marks a pivotal milestone in Waters’ transformation journey as we embark on a new chapter of growth and value creation. As the Board of Directors evaluated this opportunity throughout the process, it became evident that combining with BD’s Biosciences & Diagnostic Solutions business is an excellent strategic fit with complementary strengths. We are confident that this combination will accelerate our strategy in multiple high-growth markets and deliver substantial near- and long-term value to our shareholders.”
Udit Batra, president and CEO, Waters, said:
“Waters’ transformation, marked by strong commercial execution and revitalized innovation, positions us well for this exciting next chapter. We see tremendous opportunity to immediately apply our expertise in instrument replacement, service plan attachment, and eCommerce expansion, and realize the full potential of the flow cytometry and specialty diagnostics portfolios. The combination doubles our accessible market to approximately $40 billion and allows us to accelerate value creation in multiple high-growth adjacencies such as bioseparations, bioanalytical characterization, and multiplex diagnostics, while increasing the ratio of our annually recurring revenues.”
“We are bringing together two pioneering organizations with a rich history of delivering breakthrough innovations driven by strong R&D investment and a common customer-centric culture. I look forward to welcoming our talented and like-minded colleagues from BD’s Biosciences & Diagnostic Solutions business and leading the collective organization. Together, we will work to make this combination a resounding success for our stakeholders and deliver significant value for shareholders.”
Tom Polen, Chairman, CEO and president, BD, said:
“We are bringing together complementary portfolios and channels that create an industry-leading life science and diagnostics company. We see an incredible opportunity to leverage both companies’ commitments to unparalleled innovation, technology, and commercial presence to serve attractive high-growth end-markets, while simultaneously unlocking multiple new growth vectors. We couldn’t be more confident that the combined company, under Udit’s leadership, represents the best path to create substantial value for shareholders. Waters offers the right cultural fit for our Biosciences & Diagnostic Solutions associates to flourish and continue their legacy of developing new-to-world, innovative solutions that make a meaningful impact on global healthcare.”
“This transaction is an important milestone for BD, as it enhances our strategic focus as a leading medical technology company. BD is committed to unlocking long-term value through continued investment in our strong innovation pipeline, and operational and commercial excellence that will drive durable and profitable growth. BD will also receive a cash distribution of approximately $4 billion, which enhances our capital allocation framework, including a commitment to use at least half of the cash proceeds to repurchase shares, with the remaining balance allocated to debt repayment.”
