UK engineering business Smiths Group is considering plans to merge its healthcare business with an American rival ICU Medical Inc. The plans are still at an early stage and there is no certainty that the deal will be concludedsince Smith has been exploring other opportunities to merge its medical division with another company.
Smith manufactures products that range from baggage scanners, bomb detectors, epidural kits, medical equipment, filtration systems and much more. For several months, Smiths has been searching for ways to enhance its medical unit that develops healthcare equipment for hospitals since the unit has not been making significant revenues in the recent past.
Stagnant Growth For Medical Unit
Smith’s medical unit is the largest and most profitable unit for Smiths hence the firm is working hard to return it to growth. However, the company stated that the unit has been incurring huge research and development costs that are negatively impacting on the company’s short-termprofitability.
This year, Smith reported disappointing financial figures with revenues falling 4% down to £1.55bn and the pre-tax profits down 12% at 217 million by the end of January. However, the company’s stock gained 15.4% at £17.20.
The ICU Medical is renowned for taking over other struggling companies. For instance, last year, the firm acquired Pfizer’s Hospira Infusion System unit at $900 million. The company produces medical devices used in oncology, vascular therapy, andother critical medical care units.
ICU’s medical product portfolio includes IV smart pumps, connectors, closed transfer devices for hazardous drugs, sets, cardiac monitoring systems and much more that are designed to meet clinical and safety measures at the workplace. The company recently announced its Q1 2018 earnings with revenue growth of over 372 million and net income of $4.9 million.
Grand Changes In Company’s Directorate
Last week, the Smiths’ board of directors announced a few changes to the composition of its board members and committees. Olivier Bohuon and Dame Ann Dowling were appointed as non-executive Directors for the company with effect from July 1 and September 19, 2018 respectively. The two will become members of the Nomination, Audit and Remuneration Committees.
Anne Quinn, the current Remuneration Committee chair, will now step down from the Board with effect on July 1, 2018. However, she will continue to leadthe management team on the review of the company’s Directors’ Remuneration Policy until she steps down from the position.