US HEALTHCARE: Abbott Labs (ABT): M&A Confirmed
Nov-20 12:49
(ABT; Aa3/AA-/NR)
#MNI #Healthcare
Abbott Agrees to Acquire Exact Sciences Corp. Slight Credit Negative.
- ABT has agreed to acquire Exact Sciences Corp (EXAS) for $105/share which equates to a total equity value of $21bn and total enterprise value of $23bn. ABT will absorb EXAS' net debt of $1.8bn.
- ABT believes the transaction will close in 2Q26 and expects to finance the deal with a combination of cash on hand and debt financing.
- The Company expects to "maintain an investment grade credit-rating" with no details on what level or impact this will have on the Aa3/AA- ratings.
- ABT expects an initial FY26 adjusted gross leverage of 2.7x immediately following close of this deal.
- This purchase price is higher than we estimated yesterday so if we assume $20bn of new debt for this deal, we see gross leverage increasing to ~2.7x from 1.8x at 3Q25. ABT did not provide a de-leveraging target in the slides so we wait for the M&A call to see what ABT's de-leveraging plan will be.
- Please see our note from yesterday on this deal: https://www.mnimarkets.com/articles/abbott-labs-abt-manda-speculation-1763578457312
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