DEERFIELD, ILL. (Aug. 25, 1:15 p.m. ET) — Baxter International Inc. said it would pay $380 million for a Colorado company whose technology is designed to make intravenous delivery safer and more efficient.
Deerfield-based Baxter is buying Englewood, Colo.-based Baxa Corp., a privately held company with about $150 million in 2010 sales.
Baxter said it expects accounting and transaction costs related to the deal to cut earnings by about 3 to 5 cents a share this year but to increase earnings per share after that, Baxter said.
Baxa has about 600 employees, most of them in Englewood, a Baxter spokeswoman said Thursday.
The companies will operate separately until the deal closes, according to a spokeswoman. “During the integration planning process, which we are just beginning, we will assess the right structure for the business moving forward. It is too soon to speculate any further changes at this time,” the spokeswoman says in an email.
Baxa's products “will complement Baxter's portfolio of nutrition products and drug delivery systems and supports patient safety,” Baxter said in a statement.
Baxter Chief Financial Officer Robert Hombach said earlier this year that the company was looking for “bolt-on” deals in $100-million to $500-million range. In April the company said it would buy Pennsylvania-based Prism Pharmaceuticals Inc., a privately held drugmaker whose primary product is a medicine to combat irregular heartbeat.
The acquisition is an “incremental positive,” according to a report issued by investment house Morgan Keegan & Co. after the deal was announced.
Baxa derives about three-quarters of Baxa's sales from the U.S., which suggests that Baxter can use its marketing presence outside of the country to boost sales, according to the report, co-authored by analyst Lawrence Keusch.
As a result of the deal, Baxter's sales for 2012 are projected to rise by 6 percent, compared to Morgan Keegan's previous prediction of 5 percent growth.