Bayer to buy birth-control devices maker for $1.1 billion

Mon Apr 29, 2013 6:49am EDT
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By Ludwig Burger

FRANKFURT (Reuters) - Germany's Bayer AG (BAYGn.DE: Quote) has agreed to buy U.S. contraceptive devices maker Conceptus CPTS.O for $1.1 billion, aiming to underpin its position as the world's largest women's healthcare provider,

Bayer, whose shares were down 2.3 percent by 0823 GMT, will launch a public tender offer to acquire all Conceptus shares for $31.00 each in cash, in an offer agreed with Conceptus's management, Bayer said on Monday.

That is a premium of 19.7 percent over the stock's closing price on Friday and a multiple of about 30 times the adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) that Conceptus is targeting for this year.

Shares in global healthcare equipment and services companies on average trade at 9 times annual EBITDA, according to Thomson Reuters StarMine.

Bayer's women's healthcare business had sales of 3.15 billion euros ($4.1 billion) last year, from products including its Yasmin contraceptive pill and Mirena intrauterine device.

"Our experience in the field of gynecology combined with our sales and distribution expertise will help to further develop Conceptus' business," said Andreas Fibig, head of Bayer unit HealthCare Pharmaceuticals.

Conceptus, which makes inserts that are placed into the fallopian tubes as a permanent non-hormonal contraceptive, had $28.2 million in adjusted EBITDA last year on sales of $141 million.

The U.S. company has forecast 2013 adjusted EBITDA of between $34 million and $37 million on sales of between $155 million and $159 million.   Continued...

The logo of Germany's largest drugmaker Bayer HealthCare Pharmaceuticals is pictured on the front of its building in Berlin April 28, 2011. REUTERS/Fabrizio Bensch