Royal Philips on Friday announced plans to purchase a remote cardiac diagnostics and monitoring company for an estimated $2.8 billion.
The transaction, under which Philips plans to acquire Malvern, Pa.-based company BioTelemetry for $72 per share in cash, is expected to close in the first quarter of 2021.
BioTelemetry sells wearable heart monitors and analytics services that detect abnormal heart rhythms. The company in 2019 reported $439 million in sales.
When the transaction closes, BioTelemetry and its roughly 1,900 employees will become part of Philips' connected care business segment. Philips officials said they expect BioTelemetry to contribute to the company's overall sales growth, in part by cross-selling with Philips' other digital health products.
BioTelemetry's board of directors has approved the acquisition and recommended the offer to its shareholders.
The acquisition would strengthen Philips' healthcare focus, as well as expand the Amsterdam-based company's U.S. footprint, according to company officials.
Philips officials noted that adding BioTelemetry's remote monitoring capabilities to its portfolio will build on Philips' patient monitoring work, which to date has mostly involved monitoring patients inside of healthcare facilities. Philips' tools monitor around 300 million patients in hospitals each year; BioTelemetry annually monitors more than 1 million patients remotely.
"The acquisition of BioTelemetry fits perfectly with our strategy to be a leading provider of patient care management solutions for the hospital and the home," said Frans van Houten, CEO of Royal Philips, in a statement.
Philips in 2020's third quarter posted an estimated $6.1 billion in sales, up 5.9% year-over-year, and $582.5 million in operating income, up 48.75% year-over-year. Philips' connected care business accounted for nearly one-third of the company's third-quarter sales at $1.9 billion, up 35.9% year-over-year.