It was almost a year ago but we remember it so clearly: waking up to learn that Guidant and Boston Scientific had consumated their record-breaking merger, leaving Johnson & Johnson in the cold (they later sued).
With their stock price down, and with promises to expunge the Guidant brand, people are wondering: Any regrets? Boston Scientific says no, but then again, their initials are BS. Redd Herring has the story:
Med-tech maker Boston Scientific had a tough 2006. Despite winning a high stakes-biding war for troubled heart device maker Guidant, glory was short lived. Investors sent Boston Scientific’s shares down about 30 percent, saying the company paid too much when it agreed to fork out $27 billion for Guidant.
And as if that weren’t enough, Fortune magazine called the buyout “the second worst deal ever” (the first honor went to the AOL/Time Warner deal). But Boston Scientific isn’t making any apologies. This week at the JPMorgan Healthcare Conference in San Francisco, Boston Scientific CFO Lawrence Best took to the stage to defend the company’s decision.
“Best thing we ever did,” Mr. Best said about the deal. And to be clear, “it’s not about how much we paid. Thank God we paid.” he added. In fact, “We sleep much easier today than we would have otherwise,” he said.
…As to the greater plan, Mr. Best said he’s “developing thoughts” as to what’s best for shareholders, rating agencies, and the company. At this point, “anything is on the table,” he said.
When pressed for any type of detail, Mr. Best would only comment, “I’m not done thinking about it.”
“It sounds like George Bush thinking about Iraq,” quipped JPMorgan medical device analyst and conference moderator Michael Weinstein.
Wow. We thought they’d be greeted as liberators.
Flashback: Medgadget’s complete Boston Scientific / Guidant / Johnson & Johnson coverage