Merit Medical Signs Agreement to Purchase Lead Management Portfolio from Cook Medical

Core Viewpoint - Merit Medical Systems, Inc. has signed a definitive asset purchase agreement to acquire Cook Medical's lead management portfolio for approximately $210 million, which is expected to enhance its electrophysiology and cardiac rhythm management (CRM) business, contributing an estimated $40 million in annual revenue starting in fiscal year 2025 [1][3][4]. Group 1: Acquisition Details - The acquisition is projected to close in the fourth quarter of 2024, pending regulatory approvals and customary closing conditions [1]. - Cook Medical's lead management business has a 34-year operating history and offers a comprehensive product portfolio for lead management procedures [2]. - Merit plans to fund the acquisition through cash on hand and borrowings from its long-term credit facility [1]. Group 2: Financial Impact - The assets from Cook Medical are expected to generate approximately $37 million in revenue for the twelve months ending December 31, 2023, with geographical sales distribution of 41% in the US, 42% in EMEA, 11% in APAC, and 6% in ROW [4]. - The acquisition is anticipated to contribute between $4 million to $6 million in revenue from the projected closing date through the end of 2024, although it may dilute Merit's non-GAAP operating margin and net income for that year [4][5]. - For the fiscal year 2024, Merit has updated its financial guidance to reflect the acquisition's impact, projecting net sales between $1.339 billion and $1.351 billion, representing a year-over-year growth of 6.5% to 7.5% [8][9]. Group 3: Strategic Positioning - The acquisition aligns with Merit's Continued Growth Initiatives, enhancing its offerings for cardiac intervention patients and positioning the company to capture a larger share of the estimated $900 million annual addressable market in the US, EMEA, and APAC regions [3]. - The addition of Cook's lead management business is expected to result in over $100 million in combined annualized revenue from electrophysiology and CRM, strengthening Merit's market position [3].