Research Update: Boston Scientific Corp. Ratings Affirmed On Announced Acquisition Of BTG PLC, Outlook Remains Positive

Medical device manufacturer Boston Scientific Corp. is buying BTG PLC, a London-based medical device and pharmaceuticals firm, for approximately $4.2 billion in a debt-funded transaction. The acquisition announcement follows a trajectory of deleveraging and maintaining a strong operating performance by Boston Scientific, which reflects its steady high-single-digit revenue growth and the decreasing litigation expenses/liabilities related to the pelvic mesh claims. Pro forma for the transaction, we expect Boston Scientific's 2019 leverage to be 3.7x, which is materially higher than our prior expectation of 3.0x. Nevertheless, we expect that the company will reduce its leverage and generally maintain it below 3.5x in 2020 and beyond. We are affirming all of our ratings on Boston Scientific, including the 'BBB-' long-term issuer credit

...+ Medical device manufacturer Boston Scientific Corp. is buying BTG PLC, a London-based medical device and pharmaceuticals firm, for approximately $4.2 billion in a debt-funded transaction. + The acquisition announcement follows a trajectory of deleveraging and maintaining a strong operating performance by Boston Scientific, which reflects its steady high-single-digit revenue growth and the decreasing litigation expenses/liabilities related to the pelvic mesh claims. + Pro forma for the transaction, we expect Boston Scientific's 2019 leverage to be 3.7x, which is materially higher than our prior expectation of 3.0x. Nevertheless, we expect that the company will reduce its leverage and generally maintain it below 3.5x in 2020 and beyond. + We are affirming all of our ratings on Boston Scientific, including the '###-' long-term issuer credit rating. + The positive outlook reflects our expectation that the company will generally maintain adjusted debt leverage of less than 3.5x in 2020 and...

Research Update