Danaher Corporation (DHR) completed its previously announced acquisition of the Kloten, Switzerland-based dental implants manufacturer – Nobel Biocare Holding AG. With the buyout, Danaher now possesses 97% of Nobel Biocare’s issued registered shares and became one of largest companies in the dental implants market.
Danaher, in particular, announced the settlement of public tender offer for all registered shares of the acquired firm. Notably, the acquiree company may request the termination of the outstanding shares of Nobel Biocare in first-quarter 2015 or opt for a freeze-out merger of the acquired firm. In the latter case, Danaher expects the remaining stakeholders to not to get over CHF 17.10 (Swiss Franc) per share.
Amid the increasing demand for cosmetic dentistry, we view the above-mentioned acquisition as a strategic fit for Danaher as it will augment the company’s presence across the global dental industry. Importantly, Nobel Biocare's prowess in arenas of dental implants, digital prosthetics and software solutions will adequately complement Danaher Dental segment’s strength in 3D imaging, intra-oral scanning and solutions for digital restoration. The integration of these two companies will not only benefit the dentists and patients, but will also create a stable foundation for driving future growth.
On a separate note, Danaher stated the reaffirmation of its fourth-quarter 2014 GAAP earnings guidance in the range of $1.00 to $1.04 per share. The company also provided its adjusted earnings per share outlook for full-year 2015. Danaher expects it to be in the range of $4.35 – $4.45, with its revenues growth expected in the range of 3% – 4%.
The outlook reflects Danaher’s optimism fueled by improving performance of its operating arm – Danaher Business System (DBS) – that has been effectively augmenting the margins and cash flow. Moreover, increased organic investments and portfolio streamlining initiatives of the company poises it well for growth in the coming year.
Danaher currently has a Zacks Rank #3 (Hold). Some other stocks worth considering in the same sector include Federal Signal Corp. (FSS), Carlisle Companies Incorporated (CSL) and The Goodyear Tire & Rubber Company (GT). While Federal Signal carries a Zacks Rank #1 (Strong Buy), Carlisle and Goodyear Tire have a Zacks Rank #2 (Buy).
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