Japanese medical equipment firm Terumo Corp <4543.T> plans to buy U.S. medical device company CaridianBCT from Sweden's Gambro AB for $2.6 billion, joining a list of firms eyeing to expand abroad via acquisitions.
The acquisition, the biggest-ever in Japan's medical equipment sector, comes as the country's pharmaceutical companies gear up overseas buys to leverage the yen's strength and bolster product pipeline.
Terumo will buy CardianBCT from Gambro, which is owned 49 percent by Investor AB
Terumo, which ranks No.5 in the global blood banking business, said the acquisition would help it achieve 70 billion yen ($850 million) in annual sales in the sector.
Terumo has been trying to boost its blood transfusion-related operations and the deal is expected to help it, said Satoru Takaoki, chief analyst at SMBC Friend Research Center.
The transaction value is about 14 times Caridian's EBITDA, and it's slightly higher than typical multiples, but I think it is within an acceptable range.
Colorado-based CaridianBCT specializes in making equipment used in blood banks and other disposable medical devices. It had sales of $524 million in the year ended in December.
Terumo said it plans to use cash available and bank loans to complete the deal. It plans to close the deal by May.
Terumo's shares closed down 1.75 percent at 4,495 yen before the announcement, while the Nikkei 225 average <.N225> lost 1.8 percent.
(Reporting by Mariko Katsumura and Taiga Uranaka; Editing by Joseph Radford and Vinu Pilakkott)