Stryker buys Boston Scientific neurovascular unit
Stryker Corp. said Monday it closed its $1.5 billion acquisition of Boston Scientific Corp.' neurovascular business.
The neurovascular business is based in Fremont, Calif., and makes devices that are used to treat brain aneurysms and other vascular diseases that affect the brain. Its products include stents and detachable coils. Stryker and Boston Scientific announced the deal in late November.
Boston Scientific said Stryker paid $1.38 billion upfront for the business, along with a $50 million milestone payment. Another $24 million was placed in escrow and will be released when the deal closes in foreign markets. Stryker will pay the last $50 million when some manufacturing facilities are transferred or separated from Boston Scientific.
Boston Scientific, of Natick, Mass., said it will receive $1.2 billion in after-tax proceeds from the deal and will post a pretax gain of about $500 million in the first quarter of 2011. However it expects the deal to reduce its 2011 profit by 4 to 6 cents per share.
Stryker said the deal will be neutral to its profit in 2011 or could increase it slightly. That estimate excludes one-time charges.
Shares of Kalamazoo, Mich.-based Stryker rose $1.03 to $54.73 in afternoon trading. Shares of Boston Scientific picked up 8 cents to $7.65.