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Baxter leaps towards Cheetah in USD 230mn deal
Posted on Wednesday, 11 September 2019 11:50
Baxter International is sprinting ahead with a USD 230.00 million agreement to acquire Cheetah Medical from HighCape Capital.

The acquiror, billed as a leader in global medical products, has agreed to pay USD 190.00 million upfront and a further USD 40.00 million at an unspecified later date based on clinical and commercial milestones.

Baxter believes the addition of Cheetah will expand its specialised patient monitoring portfolio, while accelerating products and therapies with a non-invasive hemodynamic system used for fluid management.

Through using the target’s medical equipment clinicians can better manage patients with sepsis, acute kidney injury and other critical conditions, as well as for people undergoing surgery.

Founded in 2000 and having headquarters in Boston, the US and Tel Aviv, Israel, Cheetah’s technology is available in 30 countries around the world and provides Baxter with its latest Starling SV system.

Closing is expected in the fourth quarter of 2019 and remains subject to the usual raft of conditions.

Baxter believes Cheetah will be immaterial to earnings in 2019 and 2020.

Research from the University of Kansas Medical Centre has shown effective fluid management can cut hospital ICU stays by an average of 2.9 days, therefore reducing the risks of mechanical ventilation and acute dialysis and saving USD 14,000 in medical costs per patient.

Cheetah’s systems in the market have an impact in more than 400 hospitals across the US and in 30 countries worldwide.

Baxter has over 85 years’ experience in the medical equipment sector with products sold in over 100 locations globally in the areas of medication, clinical nutrition, advanced surgery and acute therapies.

In the six months to 30th June 2019, the company generated net income of USD 690.00 million on net sales of USD 5.47 billion.

According to Zephyr, the M&A database published by Bureau van Dijk, there have been 844 deals targeting the medical equipment and supplies manufacturing sector announced worldwide in 2019 to date.

The largest of these involves 3M buying Acelity, a US-based surgical healing and hospital patient-mobility equipment maker, for USD 6.73 billion.

NxStage Medical, BioTek Instruments, NuVasive and Bayer’s Dr. Scholl's business in the Americas, among others, have also been targeted in the year so far.

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