Philips scoops up BioTelemetry for $2.8B in big bet on remote care

• Philips (NYSE:PHG) has agreed to buy U.S. cardiac diagnostics and monitoring firm BioTelemetry (NASDAQ:BEAT) for $2.8B, sending shares of the latter up 15% in premarket trade. Philips will pay $72 per outstanding BioTelemetry share in cash, marking a 16.5% premium to the stock's closing price on Thursday.
• BioTelemetry primarily focuses on the diagnosis and remote monitoring of heart rhythm disorders, a business that represented 85% of its $439M sales last year, and will become part of Philips' connected care business.
• "We have always been very optimistic about connected care," Philips CEO Frans van Houten told reporters. "With COVID we have seen an acceleration of the demand and we think this acquisition fits perfectly in this era where remote patient monitoring will become ever more important."
• The company expects BioTelemetry to deliver double-digit growth and improve its adjusted EBITA margin to more than 20% by 2025.
• PHG +2.4% premarket

Comments

[fmontgomery]

Hard to know if this is the best offer. Does anyone think someone will come in and make a higher bid? Why?

[ceristeare]

@fmontgomery

Corps that actually make money are often subject to more realistic valuations.

PHG swooped in at a growth stall point for BEAT and the stock price reflected it. At the buyout price, BEAT has a P/S ratio similar to that of MDT so I believe the offer reflects realistic future growth potential.

This move occurs at a time when PHG is making a transition (selling it's appliance division) and if another corp pays more for BEAT I'd be surprised.

[fmontgomery]

@ceristeare Thank you. Makes sense.

[PHOTIOS]

They should pay more!

[alpha2735]

About freaking time!

[Peter Peeters - old]

Good news about Philips. It is time for it.