Philips and Respironics announce merger agreement

Philips Healthcare, a division of Royal Philips Electronics, has announced that it has made a public offer for all shares of Respironics.

The announcement marks a definitive merger agreement between the two companies which will see Philips commence a tender offer to acquire all outstanding shares of Respironics for $66 (33 pounds) per share – equivalent to a total purchase price of $5.1 billion.

The board of directors at Respironics has unanimously approved the transaction and has recommended the offer to their shareholders.

Philips Healthcare has confirmed that the transaction would place the company as a global leader in the home healthcare market by expanding its product portfolio in obstructive sleep apnoea and home respiratory care.

Gerard Kleisterlee, president and chief executive officer of Philips, welcomed the acquisition and described it as an “excellent strategic fit” that would drive growth in home healthcare.

“The acquisition of Respironics is another major milestone towards the completion of our objective to build market leadership positions in high-growth, high-margin businesses across the three market sectors of healthcare, lighting and consumer lifestyle,” he added.

Respironics sees three-quarters of its sales come from its sleep and home respiratory business which comprises of therapeutic devices for sleep disordered breathing and chronic respiratory diseases.

Last year, Philips successfully acquired the US firms Emergin and Visicu as part of its healthcare division.