Category: Headlines

Swiss cement firm Holcim is to buy French rival Lafarge to create the world’s biggest cement maker with combined sales of 32bn euros (£26.5bn; $44bn). Under the terms of the deal, Lafarge shareholders will receive one Holcim share for each Lafarge share they own. The two firms said they would sell some assets to ease competition concerns. The companies added they forecast total annual savings from joining forces of 1.4bn euros. The two firms had announced on Friday that they were in advanced talks over a deal. “The new group will offer higher growth and low risk, thus creating more value,” said Lafarge chief executive, Bruno Lafont, who will become chief of LafargeHolcim. The combined firm will be based in Switzerland. The deal may help the firms cope with higher energy prices and weaker demand that have hurt the sector since the financial crisis. The new company will be worth about £33bn based on Friday’s closing share prices. Although the firms have overlapping operations in Europe, Lafarge is strong in Africa and the Middle East, whereas Holcim is almost absent in these regions. Meanwhile, Holcim is strong in Latin America, where Lafarge is not established

Drugmaker Shire clinched its six-month pursuit of Baxalta International on Monday with an agreed $US32 billion ($45.8 billion) cash-and-stock offer, catapulting it to a leading position in treating rare diseases. The London-listed group, which first approached the US company with an all-stock offer in July, won over the maker of treatments for rare blood conditions, cancers and immune system disorders after adding a cash sweetener. Shire shares were off more than 8 per cent, however, as investors worry about a potential competitive threat from Roche to Baxalta’s critically important haemophilia franchise, and on nerves over the price offered and a cost savings forecast that Jefferies analysts called “somewhat disappointing.” The deal marks a strong start to mergers and acquisitions in healthcare in 2016 after the sector had its biggest deal-making streak in history last year, with global transactions totalling $US673 billion, according to Thomson Reuters data. It also highlights the appeal of medicines for rare diseases targeting small groups of patients for which drugmakers can charge hundreds of thousands of dollars a year. “Together we will have the number one platform in rare diseases with a strong foundation for future growth,” Shire Chief Executive Officer Flemming Ornskov told reporters, after unveiling his company’s most ambitious acquisition yet. Shareholders will receive $US18 in cash and 0.1482 Shire American depositary share per Baxalta share, implying a total value of $US45.57 per share based on Jan. 8 prices. That is 37.5 per cent above Baxalta’s price on Aug. 3, before Shire went public with its interest. Illinois-based Baxalta, which was spun off last year from Baxter International Inc, rejected Shire’s previous $US30 billion all-stock offer in August, arguing it significantly undervalued the company. But Ornskov relentlessly pursued Baxalta, seeking to pressure it into agreeing to a deal by meeting with Baxalta’s major shareholders over a period of months. That enabled it to sidestep a hostile deal in which it would have faced takeover defences including a “poison pill” that stopped unwanted suitors from buying more than 10 per cent of the company and a hard-to-replace board. Reuters had reported last week that Shire and Baxalta could announce a deal as early as Monday, after Ornskov added cash and raised the offer price. Shares of Baxalta were down 2.6 per cent at $US38.96 on the New York Stock Exchange on Monday afternoon, giving back earlier gains. Shire had initially offered only stock due to concerns a cash element might jeopardise the tax-free status of Baxalta’s spin-off from Baxter. However, Ornskov said he was confident that adding $US18 in cash would maintain this tax-free status. “We came out without any doubt that this was not jeopardising the tax-free nature of the spin,” Ornskov said. Together, the two companies said they expected to deliver double-digit sales growth with more than $US20 billion in annual revenue by 2020. With annual operating cost synergies of more than $US500 million, additional revenue synergies and tax benefits from Shire’s Irish domicile, Shire said it expected the transaction to boost non-GAAP diluted earnings from 2017. Baxalta brings Shire a strong position in haemophilia treatments, although that could face a serious challenge by late 2017 or 2018 from Roche’s experimental antibody ACE910 that received breakthrough designation – given to potentially important advances over current treatments – from US health regulators. The Roche drug has a long half-life that could allow for less frequent dosing. “A lot of people don’t like the deal” largely due to its dependence on Baxalta’s haemophilia franchise, said John Boris, analyst with Suntrust Robinson Humphrey. “They believe Shire is buying an asset that is going to be under pressure, so it may not reach the $US20 billion revenue by 2020 target,” Boris said. UBS analysts cautioned that Baxalta could actually dilute Shire earnings from 2019 to 2023 before being accretive again from 2024. Thanks to its base in Dublin, the combined company is expected to have an effective tax rate of 16 to 17 per cent by 2017, down from around 23 per cent for Baxalta, making the deal the latest transaction to result in lower tax rates. Ornskov has stepped up his acquisition efforts in the rare diseases space after a planned takeover by US drugmaker AbbVie Inc fell through last year. He bought NPS Pharmaceuticals for $US5.2 billion in February and Dyax for $US5.9 billion in November. Shire signed an $US18 billion facility to help finance its latest purchase. Shire was advised by Evercore, Morgan Stanley, Barclays and Deutsche Bank. Baxalta was advised by Goldman Sachs and Citi. According to Freeman/Thomson Reuters estimates, Shire’s advisers could be in line for fees of $US50 million-$US60 million and Baxalta’s may earn $US70 million-$US80 million.

Philips has agreed to acquire SpectraWAVE, a Massachusetts-based medical device company focused on technologies to help diagnose and guide treatment for patients with coronary artery disease. SpectraWAVE’s technology specialises in advancing intravascular imaging and physiological assessment with AI. This acquisition positions Philips at the intersection of diagnostic imaging, cardiovascular health, and AI-driven healthcare. This acquisition will strengthen Philips’ presence in the intravascular imaging, physiological assessment, and intravascular ultrasound catheters (IVUS) device market. Leading data and analytics company GlobalData predicts that the global IVUS market will see steady market value growth in the near future, with a compound annual growth rate of 4% over the 2024-2034 period. Currently Philips leads in market share of the global (North America, Europe, Asia-Pacific, south Central America, and the Middle East and Africa) IVUS market, with 88%. Currently, North America is the largest market for IVUS medical devices, with a market value of $490m. During the 2024-2034 period, GlobalData forecasts the North American IVUS market to grow in value by 6%. Growth in demand for IVUS medical devices stems from the increasing incidence of cardiovascular diseases (CVDs), which are the leading cause of death globally. Factors that exacerbate the prevalence of CVDs, driving the global IVUS market, include ageing populations and a high rate of smoking in some countries. A worldwide increase in healthcare spending, as well as the effects of globalisation, will also drive this market. However, the high cost of imaging techniques and a lack of heart speciality hospitals in some regions will act as barriers to the adoption of IVUS based procedures. Philips’ acquisition of SpectraWAVE will include the HyperVue Imaging System with AI-supported imaging inside the coronary arteries and X1-FFR, an AI-enabled angio-based fractional flow reserve (FFR) technology. X1-FFR provides a direct feed from angiography systems, which can be used by clinicians in finding the correct location for stent placements and other intervention. Philips’ acquisition of SpectraWAVE will expand the company’s current intravascular imaging and physiological assessment device portfolio, which includes OmniWire iFR technology and the Eagle Eye Platinum IVUS. The announcement of Philips’ acquisition of SpectraWAVE follows the 2023 501k clearance for SpectraWAVE’s Hypervue Intravascular Imagine System, $50m of Series B funding for SpectraWAVE in September 2024, and SpectraWAVE gaining Food and Drug Administration clearance for X1-FFR in October 2025. The coupling of SpectraWAVE’s new technologies with Philips’ existing catalogue of products and market influence will potentially increase the adoption rates of IVUS-based procedures. The burgeoning application of AI in medical technology will provide new innovations for IVUS technology, as well as for the cardiovascular and diagnostic imaging sectors in general. Source: https://www.medicaldevice-network.com/analyst-comment/philips-spectrawave-acquisition-expanding-intravascular-imaging-portfolio/?cf-view