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Smith Group Agrees to Sell Smiths Medical to ICU Medical In Superior Bid

Smiths Group announced today it would sell its medical division for $2.7bn to California-based ICU Medical, after turning down a lower offer from US private equity firm TA Associates.
Smiths, an FTSE 100 group, will bank an additional $400M from the rival deal, which wil generate a further $50M in cash proceeds
.
Approximately 10 percent of the combined group’s shares will also go to Smiths Group shareholders, worth roughly $500M. Depending on future performance, the deal value could also rise by a further $100M.
The terms of the new deal were described by Smiths Group as being “superior”, while it
withdrew its recommendation to accept last month’s offer made by TA Associates.
The higher offer provides a boost to the British manufacturer, which is currently seeking to become morefocused on the industrial technology market while increasing its valuation. Analysts claim this has been negatively affected by a long-standing debate over whether to spin or sell off its medical arm.

The CEO of Smiths Group plc, Paul Keel, said:

“Delivering on our commitment to maximise value, the ICU Transaction provides both a higher value for Smiths’ shareholders, as well as future value creation through our 10% holding of the enlarged combined group and a potential $0.1bn additional contingent consideration.
We are focused on concluding this superior transaction and on driving Smiths Group forward, delivering on our significant potential as a leading industrial technology group united by shared purpose, business
characteristics and a common operating model.”

The CEO of ICU Medical, Inc., commented:

“The combination of these two businesses makes sense for the medical device marketplace and fits well with ICU Medical’s existing business. By joining two complementary product portfolios to create a leading IV therapy company, we can help simplify customer workflows and add significant value and choice. Together, we will be a scaled global competitor and a US-based medical device company that increases the stability of the medical supply chain and can grow as clinical care models evolve.
From an economic perspective, we believe we have presented a well-structured offer that considers the existing offer, minimizes risk, and offers upside to all stakeholders. We look
forward to serving more customers as we continue to bring clinical and economic value to the marketplace.”



© ICU Medical, Inc
© Smiths Group plc

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