BioTelemetry Offers To Acquire LifeWatch For $257 Million
By Jof Enriquez,
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BioTelemetry, Inc. is extending a tender offer to acquire all outstanding shares of rival cardiac monitoring company LifeWatch AG for an estimated total transaction value of 260 million Swiss francs (U.S. $257 million).
"The combination will create one of the most comprehensive connected health platforms in the world, far more capable of delivering solutions necessary to meet today’s healthcare challenges," states a joint press release.
Conshohocken, Pa.-based BioTelemetry is one of a handful of companies that makes wearable devices for cardiac monitoring that can be considered true medical wearables, says engineer Eric R. Larson of Art of Mass Production. BioTelemetry has sought to differentiate itself from rivals by offering solutions that are considered more convenient, collect more data, and perform more analysis than traditional monitoring. As a result, it has experienced rapid revenue growth as more payers decide to cover its cellular network-connected monitors, according to Erik J. Bracciodieta, a Senior Analyst on the Medical Device Insights team at Decision Resources Group.
BioTelemetry’s profits grew by almost 80 percent in 2016, to $24 million, on sales of $208 million, reports Philly.com. LifeWatch, on the other hand, generated a small profit on sales of $114 million after reporting a loss in 2015.
LifeWatch, which is headquartered in Switzerland with U.S. operations in Rosemont, Ill. and a subsidiary in Israel, specializes in cardiac monitoring services, sleep therapy, digital health systems, and wireless remote diagnostic patient monitoring wearables, including FDA-cleared patches to record ECG and vital signs.
"We are extremely excited to announce the acquisition of LifeWatch," said BioTelemetry CEO Joseph H. Capper. "We believe the combination of the two most innovative remote cardiac monitoring companies creates a unique opportunity to build an immensely successful connected health platform, capable of delivering highly sought after life-saving and cost-reduction solutions."
"We'll pull the best from both organizations [after] rationalizing the portfolio and combining staff and products," Capper told analysts in a conference call, according to Philly.com. LifeWatch will "dramatically accelerate" BioTelemetry's plans to grow beyond heart monitoring into other specialties.
LifeWatch CEO Dr. Stephan Rietiker added, "We firmly believe that BioTelemetry is the best partner to maximize the future potential of LifeWatch. We envision this combination will allow our employees further opportunities to expand the business and leverage each other’s strengths."
The transaction is expected to be completed in the third quarter of 2017. Post-closing, synergies will be fully realized over a 12-18 month period, resulting in 2017 adjusted EBITDA figures of between $95 to $100 million, according to the two companies.