Fortive Corporation offers Johnson & Johnson to acquire its Ethicon division’s ‘Advanced Sterilization Products’ (ASP) business. Fortive rose worth $2.7 billion cash for the acquisition. J&J has 120 days to accept the deal and if it results positively, then the expected closing time of the deal would be early 2019.
ASP gives inventive sanitization and cleansing arrangement and spearheaded low-temperature hydrogen peroxide disinfection innovation comprehensively. ASP generated approximately $775 million revenue in 2017 and for Fortive, being a manufacturer of industrial products, entrance in medical industry with ASP would be a strongest growth opportunity.
James A. Lico, President and CEO of Fortive Corporation, said that, “We are excited about today’s announcement which demonstrates the continued evolution of our portfolio towards improving growth, increasing recurring revenue, and expanding positions in attractive markets. With ASP, we expect to acquire a global leader in medical sterilization and disinfection, with a large installed base and very strong brands. This acquisition is entirely consistent with our focus to help customers drive better safety, compliance and efficiency in critical workflows. We have conviction that the addition of ASP to our portfolio will create compelling value for both ASP and Fortive employees, our customers, and shareholders.”
Lico added, “We are impressed by the strength of ASP’s innovative product portfolio and its customer relationships. ASP’s culture and commitment to quality and service lends itself to application of the Fortive Business System to drive both accelerated growth and operating synergies. We look forward to welcoming the ASP team to the Fortive family.”
With the acquisition, Fortive expects to adjust the offered transaction with net earnings in first full year. It plans to issue debt or equity with available cash to finance the acquisition.