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Hillrom to Acquire Ambulatory Cardiac Monitoring Technologies Provider Bardy Diagnostics
Thursday 21 January 2021

US-based medical technology company Hillrom (NYSE: HRC) has reached a definitive agreement to acquire digital health firm Bardy Diagnostics, Inc. (BardyDx), the company said.

BardyDx is provider of ambulatory cardiac monitoring technologies.

Under the terms of the agreement, Hillrom will purchase BardyDx for a cash consideration of USD 375m and future potential payments based on the achievement of certain commercial milestones.

Hillrom is also acquiring net operating losses valued at more than USD 20m that are expected to result in future tax benefits.

The acquisition of BardyDx complements Hillrom's current cardiology portfolio of cardiac stress exercise, Holter and resting electrocardiography devices.

BardyDx, with annualized revenue of approximately USD 30m, provides a differentiated, wearable bio-sensing technology, the Carnation Ambulatory Monitor (or CAM patch), that is engineered for patient-comfort, superior P-wave clarity, exceptional diagnostic yield and superior clinical accuracy.

The CAM patch is designed to promote patient compliance, streamline clinical workflow, and yield clinically actionable data in a unique and proprietary CAM report that enables physicians to identify specific arrhythmias to aid clinical decision-making.

The device employs a novel circuit design and uses advanced compression algorithms to process the signal, ensuring P-wave recording and accuracy, a significant attribute for cardiologists and electrophysiologists.

Hillrom's existing global brand, channel and presence in acute and primary care settings, and capabilities around market access, payor contracting, data security and EMR integration, are expected to drive accelerated adoption of the CAM patch and BardyDx's related suite of ECG analysis services and tools.

The company plans to finance the acquisition through a combination of cash on hand and borrowings under existing credit facilities, and expects to close the transaction in the fiscal second quarter of 2021, subject to customary closing conditions.

Hillrom expects the transaction to be dilutive to fiscal 2021 adjusted earnings by approximately USD 0.10 per diluted share and does not expect the transaction to have an impact on its previously issued fiscal 2021 financial guidance.

The transaction is expected to be dilutive in the first twelve months, increasingly accretive thereafter, and generate 10% return on invested capital by year five.
Date Published: 21/01/2021