Boston Scientific Corp., a medical device company with major operations in the Twin Cities, closed on a $4.3 billion acquisition of British health care company BTG PLC with the goal of building a wider array of devices to detect and treat cancer in less-invasive ways.
Monday's all-cash acquisition of BTG PLC represents Boston Scientific's second-largest acquisition ever, after its $26 billion purchase of Guidant in 2006. Much smaller in scale, the BTG acquisition fits with Boston Scientific's pattern in recent years of making discrete investments for companies that make products it can sell worldwide, particularly in therapies where it already has a presence.
BTG sells several different forms of minimally invasive cancer treatments for liver and kidney cancers, which Boston Scientific chief executive Mike Mahoney has said is "the gem that has the most appeal to Boston Scientific." Those include small pellets that emit radiation or chemotherapy drugs implanted directly inside tumors via minimally invasive tools that Boston Scientific already sells.
"In interventional oncology ... we are the category leader for the delivery and access tools, and BTG is the category leader for the therapeutics. By bringing these portfolios together, we now have the deepest and broadest portfolio for our customers so that they can treat more patients," Jeff Mirviss, president of Boston Scientific's Minnesota-based peripheral interventions business, said Monday. The deal will also accelerate organic sales because the Boston Scientific peripheral business is in significantly more countries around the world than BTG, he said.
For Boston Scientific, the acquisition is expected to add between 4 cents and 5 cents of adjusted earnings per share in 2020. The company expects to add jobs in Minnesota through the deal, and is planning an expansion of its Maple Grove offices to accommodate the growth.
Mahoney told investors in January that Boston Scientific analyzed BTG's business in depth for close to a year before reaching an acquisition agreement. The deal, publicly announced in November, called for Boston Scientific to pay BTG shareholders a 36.6% premium over BTG's previous closing price, Reuters reported at the time. (The actual deal value was slightly higher than the original $4.2 billion estimate because of the final share count and foreign-exchange rates.)
The deal came under close regulatory scrutiny. Regulators eventually required Boston Scientific to agree to sell off a small cancer business that it had acquired in 2015 as a condition of buying BTG, to avoid having a combined BTG-Boston Scientific dominate too much of the overall market for interventional oncology.
On Monday, Boston Scientific formally acquired BTG, removing the company from the London Stock Exchange, while Palo Alto, Calif.-based Varian Medical Systems revealed that it intends to buy Boston Scientific's Embozene and Oncozene product lines for $90 million. Varian sells a range of diagnostic and therapeutic treatments for cancer, including the ProBeam proton-beam therapy system.
