Becton, Dickinson and Company
) recently announced a definitive deal to buy California-based
health care company Safety Syringes, Inc. The financial details of
the deal were not revealed by the company. The acquisition is
expected to complete by the end of Becton Dickinson's fiscal 2012
(September), subject to certain regulatory approvals.
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Privately-owned Safety Syringes is a leading developer of
anti-needlestick instruments for pre-filled syringes. Becton
Dickinson plans to integrate Safety Syringes' specially-designed
prefillable syringes, such as the UltraSafe Passive products, in
its Medical-Pharmaceutical Systems unit.
The acquisition of Safety Syringes will boost Becton Dickinson's
heath care worker safety products portfolio. Utilizing Safety
Syringes' expertise, the company will be able to develop effective
and harmless prefillable syringes for its customers. The
acquisition is also in line with the company's long-term strategy
of advancing parenteral drug delivery systems.
Though the acquisition was expected to be slightly dilutive, Becton
Dickinson maintained its fiscal 2012 earnings from continuing
operations guidance of $5.68-$5.73 per share. The current Zacks
Consensus Estimate for fiscal 2012 is $5.70 per share.
We currently have a Neutral recommendation on the stock, which
carries a short-term Zacks #3 Rank (Hold).
The rising demand for safety-needle products (with higher price
points and margins) was the primary driver of the company's growth
in the past. However, the trend is unlikely to continue, given that
the U.S. market has already been largely penetrated.
On the positive side, Becton Dickinson's preeminent global health
care products franchise is partly insulated from volatile
macroeconomic conditions and structural deficiencies elsewhere in
the health care delivery field.
Becton Dickinson faces a number of competitors, including
) in certain niches, in each of its three business segments.