Change at Top for Dental Big Shots

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Dentsply International Inc., a leading manufacturer of dental products, has bought AstraZeneca PLC’s Astra Tech unit, a smaller unit within the company based in London that concentrates on producing dental and medical devices and constructions. The move will make Dentsply the third largest supplier and manufacturer of dental implants and supplies in the world.

The deal cost Dentsply a whopping $1.8 billion, a figure falling short by $200,000 of the $2 billion AstraZeneca had originally hoped for according to one individual who had knowledge of the deal. A spokesperson for AstraZeneca stated that the deal was accepted so the company could focus its attention on pharmaceuticals, seeing it as a safer option after incurring losses through development of genetics.

The American based Dentsply is estimated to double its implant standing with its deal with the Swedish AstraZeneca. Dentsply cash flow reached around $574 million by the end of the first quarter of this year, and as such has financed the purchase through a mixture of cash, long term debt and commercial paper. The move will obviously put the company in some amount of debt, but will also make it the third largest manufacturer of dental implants, outpaced only by Straumann Holding AG and Nobel Biocare and as such, are very pleased with the deal. An analyst from Sanford C. Bernstein, Lisa Bedell Clive, stated that the huge move showed Dentsply’s commitment to the dental field and dental implants specifically for the present and future.

AstraZeneca believe the sale won’t affect their profits for this year because the unit wasn’t included in the company’s core financial measurements, and as such the top shots at the company see it as an excellent result.

As long as everything goes to plan and the deal is cleared by the shareholders of AstraZeneca, the purchase is set to go through during the second half of the year.

 

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