So that’s that, for now
It appears Boston Scientific won the bidding wars for Guidant since Johnson & Johnson did not up its bid before last night’s deadline. The timeline for the entire process is fascinating to me. Did they pay too much? BSX has one of the lowest P/E ratios in their industry, due in large part to their projected growth forecasts. While Guidant gives them access to a fast-growing market, they will have to execute very well over the next few years to insure they get full value for what they paid.
We should be seeing ripple effects from this acquisition in the medical device field for some time to come.
We should be seeing ripple effects from this acquisition in the medical device field for some time to come.
posted by Dwight at
8:28 AM
2 Comments:
It's hard for me to imagine that they didn't overpay for this one.
By
Anonymous, at 11:55 AM
That was my gut reaction, too. However, the more I look at it the more I like it. The market Boston is getting into is growing extremely fast. I think the stock market has overreacted to Guidant’s problems (although they did an excellent job of bringing that on themselves).
My guess is two years for now the combined companies will have a license to print money and retire the debt faster than planned. Add Boston’s pipeline and it looks better than I originally thought. One part of the deal I haven’t seen explained very well is where this puts Boston from a patent position on their stents. I would guess they are better protected than ever and possibly set up for dominating the market for a while.
By
Dwight, at 2:58 PM
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