Featured Company News – Philips to Acquire Spectranetics; Set to Expand its Image-Guided Therapy Portfolio

LONDON, UK / ACCESSWIRE / June 30, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for Koninklijke Philips N.V. (NYSE: PHG), following which we have published a free report that can be viewed by signing up at http://protraderdaily.com/optin/?symbol=PHG.

The Company announced on June 28, 2017, that under a definitive merger agreement, it has acquired Spectranetics Corp. (NASDAQ: SPNC), a US-based global leader in vascular intervention and lead management solutions. The implied transaction is valued at about €1.5 billion and includes Spectranetics’ cash and debt. For immediate access to our complimentary reports, including today’s coverage, register for free now at: http://protraderdaily.com/register/.

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The Announcement

Philips, a global leader in health technology, has a market-leading position in the €6 billion image-guided therapy market with a unique portfolio of interventional imaging systems and devices, planning and navigation software and services, where it serves a large customer base and is supported by a global network of leading clinical partners.

Philips views this acquisition as a step to further expand and strengthen its position in the Image-Guided Therapy Business Group. Spectranetics, being a leader in vascular intervention to treat coronary and peripheral artery disease, is complementary to Philips’ portfolio. Also, Spectranetics is a leading provider of minimally invasive removal of implanted pacemaker and implantable cardioverter defibrillator leads. The Company currently is growing double digits and projects FY17 sales in the range of $293 million to $306 million.

Spectranetics Portfolio

Spectranetics’ device portfolio includes a range of laser atherectomy catheters for treatment of blockages with lasers in both coronary and peripheral arteries. The portfolio additionally includes AngioSculpt scoring balloon, used to mechanically push a blockage aside in both peripheral and coronary arteries and the AngioSculptX scoring balloon, which according to the Company is the only drug-coated scoring balloon presently, and the Stellarex drug-coated balloon which is used to treat common to complex lesions while inhibiting the recurrence of these blockages. The Stellarex drug-coated balloon is the key growth driver for the Company where it is already CE market and under review by the FDA for premarket approval in the United States.

Financial Details

Philips will commence a tender offer to acquire all of the outstanding shares of Spectranetics for $38.50 per share, to be paid in cash upon completion. This price represents a 27% premium to the Spectranetics’ closing price on June 27, 2017. Spectranetics’ Board of Directors have approved the transaction and recommended the offer to its shareholders, while the transaction is expected to close in Q3 FY17.

Upon completion of the transaction, Spectranetics and its workforce of over 900 employees will become part of the Image-Guided Business Group within Philips. The Company views sustained high sales growth through new product introductions across a decidedly synergistic therapy device portfolio.

Company Growth Prospects

This transaction is viewed by Spectranetics as a step to enhance the geographical reach of its products and harness mass commercialization opportunities in new, adjacent segments. As a part of the Company, Spectranetics will benefit immediately from Philips platform enabling cost and working capital synergies. As a result of the transaction, the combined Spectranetics and Philips Image Guided Therapy Devices business are expected to grow to about €1 billion by 2020.

Philips, in an attempt to establish itself as the leader in the healthcare segment, announced on June 01, 2017, a research agreement with Memorial Sloan Kettering Cancer Center to jointly develop advanced genome analytics for precision oncology. Philips and Memorial Sloan Kettering already have research collaboration in the field of radiation oncology, where MR imaging is used for treatment planning.

Last Close Stock Review

At the closing bell, on Thursday, June 29, 2017, Koninklijke Philips’ stock slipped 1.90%, ending the trading session at $35.72. A total volume of 1.00 million shares have exchanged hands. The Company’s stock price skyrocketed 11.42% in the last three months, 18.40% in the past six months, and 46.39% in the previous twelve months. Moreover, the stock surged 16.85% since the start of the year. The stock is trading at a PE ratio of 25.10 and has a dividend yield of 2.41%. The stock currently has a market cap of $34.03 billion.

Spectranetics’ share price finished yesterday’s trading session flat at $38.35. A total volume of 6.00 million shares have exchanged hands, which was higher than the 3-month average volume of 895.21 thousand shares. The Company’s stock price skyrocketed 35.04% in the last three months, 56.21% in the past six months, and 109.33% in the previous twelve months. Additionally, the stock soared 56.53% since the start of the year. At Thursday’s closing price, the stock’s net capitalization stands at $1.66 billion.

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