The New Brunswick, N.J.-based healthcare giant announced the deal to pick up the cardiology and endovascular business from J&J in March
The massive acquisition, which is worth some $1.59 billion net of tax benefits, offers annual synergies in excess of $100 million by the end of fiscal 2018, Cardinal Health said when it announced the deal.
“I’m extremely pleased to welcome our new Cordis colleagues to Cardinal Health. With an aging population and the accompanying demand for less invasive medical treatments, health systems around the world are searching for the best ways to ensure the highest quality care in the most cost-effective way,” CEO George Barrett said in a press release.
Reports surfaced in August putting the price tag at $1.5 billion to $2 billion; in late April Cardinal emerged as the leading suitor. That company said it is financing the buyout of Fremont, Calif.-based Cordis with a combination of $1.0 billion in new senior debt and cash. Cordis posts annual sales of roughly $780 million “split almost evenly between cardiology and endovascular products,” with about 70% coming from outside the U.S., Cardinal Health said.
Cardinal Health said it expects the deal for Cordis, which will be led by Cardinal Health medical segment CEO Don Casey, to add 20¢ to its adjusted earnings per share in fiscal 2017 and “increasingly accretive” after that.
Cordis was a pioneer in stents but has for years been losing share to rival device makers. In 2011 the company shut down its drug-eluting stent program, citing “evolving market dynamics” that made other cardiovascular device areas more promising targets for its efforts. The sale would also fit in line with J&J’s larger efforts to streamline its business and reduce costs. The healthcare giant also sold its Ortho-Clinical Diagnostics unit for $4 billion in 2014.