Baxter completes $10.5 billion acquisition

DEERFIELD - Baxter International Inc. Monday said it has completed its $10.5 billion acquisition of Hillrom, a Chicago-based connected care technology developer.

Baxter's proposed acquisition of Hillrom was announced on Sept. 2. Baxter paid $156 in cash for each outstanding share of Hillrom common stock for a purchase price of $10.5 billion. Including the assumption of Hillrom's outstanding debt obligations, the enterprise value of the transaction is approximately $12.5 billion.

"Integrating our complementary capabilities introduces additional opportunities for growth across our broad geographic footprint and also creates remarkable new possibilities for connectivity with leading-edge digital health innovation focused on enhancing care, lowering costs and increasing workflow efficiency," said José (Joe) E. Almeida, Baxter's chairman, president and chief executive officer.

Baxter said it expects the combination to result in approximately $250 million of annual pretax cost synergies by the end of year three.

Baxter funded the acquisition, and the refinancing of certain assumed indebtedness of Hillrom, through the issuance of $7.8 billion in fixed and floating rate bonds, $4 billion in drawn three- and five-year floating rate term loan agreements, and the remainder in cash on hand.

Baxter manufactures a portfolio of diagnostic, critical care, kidney care, nutrition, hospital and surgical products used across patient homes, hospitals, physician offices and other sites of care.