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Key Takeaways
- Boston Scientific has purchased Silk Road Medical, which makes products to help prevent strokes in patients with carotid artery disease.
- The company is paying $1.26 billion for Silk Road, or $27.50 per share, a 27% premium to Monday’s closing price.
- Boston Scientific said the acquisition will not be accretive to its adjusted earnings per share until 2026.
Shares of Silk Road Medical ( SILK ) soared in intraday trading Tuesday after Boston Scientific ( BSX ) announced it was buying the medical device maker for about $1.26 billion.
Boston Scientific said it was paying $27.50 per share for Silk Road, a 27% premium to its closing price of $21.67 Monday. The deal has an enterprise value of approximately $1.16 billion, including Silk Road’s cash position of $101 million as of March 31.
Silk Road makes products to prevent stroke in patients with carotid artery disease using a minimally invasive procedure called transcarotid artery revascularization (TCAR). Boston Scientific noted Silk Road’s devices are the only ones commercially available for use during TCAR procedures.
Cat Jennings, president of Vascular, Peripheral Interventions at Boston Scientific, explained that Silk Road’s TCAR platform “is a notable advancement in the field of vascular medicine, which has revolutionized stroke prevention and the treatment of carotid artery disease.”
Acquisition Will Not Be Accretive To Adjusted EPS Until 2026
Boston Scientific said that the acquisition’s impact on adjusted earnings per share (EPS ) in 2024 and 2025 is expected to be “immaterial,” and accretive after that.
The transaction is expected to close in the second half of this year.
Silk Road Medical shares jumped about 24% as of 10:35 a.m. ET Tuesday to $26.84, their highest level in almost a year. Shares of Boston Scientific were essentially flat at $76.16.