C.R. Bard to Buy Specialized Health Products International for 5.15 Times Revenue

Weekly Corporate Growth Report, Mar 17, 2008

The Deal: C.R. Bard Inc. has agreed to acquire Specialized Health Products International Inc. for $68.4 million in cash, or $1 per share. The deal price represents a premium of 20 percent over Specialized Health's average closing share price for the 30 days prior to the deal announcement. The deal requires approval from Specialized Health shareholders. Galen Partners, which holds 22 percent of the company's shares, has agreed to support the transaction. The deal remains subject to customary closing conditions, including regulatory approval.

Discussion: Specialized Health Products International produces safety needles and safety equipment for syringes, catheters, and other disposable medical products. The company's safety products help prevent needle handling accidents, which can spread disease. The company markets its products to medical device companies including Bard Access Systems, Merit Medical Systems, and TAP Pharmaceutical Products.

C.R. Bard Inc. is a medical devices company that provides a wide range of urology, vascular, and oncology products. Bard devices include stents, catheters, guidewires, implants, surgical tools, and fluid collection systems. Subsidiary Bard Access Systems makes vascular access products.

Specialized Health stated that it has reached a point where it will require significant additional investment to continue earnings growth. Bard, which has a market capitalization of about $9.5 billion, is well positioned to make such an investment.