Philips to Pay $5.1 B for Respironics

123jump.com Staff
21 Dec, 2007
New York City

Philips Electronics has agreed to pay $5.1 billion or $66 per share of Respironics. Respironics provides treatment for sleep disorders which are estimated to affect 6% of the population in the U.S. Philips home healthcare division has made a number of acquisition this year and now care about one million people through various services in the U.S.

[R]10:45AM New York – U.S. stocks traded higher after earnings from Research in Motion, Walgreen and talks of $5 billion investment in Merrill Lynch and other large deals.[/R]

U.S. market averages opened higher after a string of better than expected earnings, talks of $5 billion investment in Merrill Lynch from Singapore sovereign fund Temasek, and economic reports.

Dow Jones Industrial Average jumped 162 to 13,407, Nasdaq added 32.44 to 2,673.62, and S&P 500 increased 17.15 to 1,477.28.

Philips Electronics has agreed to purchase Respironics $5.1 billion or $66 per share. The offer price represents a premium of approximately 31% over Respironics'' average closing share price for the thirty trading days ended December 20, 2007. The Board of Directors of Respironics has unanimously approved the transaction.

According to the company press release, after the purchase, Respironics will become the headquarters for Philips Home Healthcare Solutions group within Philips Healthcare, and Respironics'' senior operating leadership are expected to remain with the organization.

Philips has made a number of successful acquisitions in the area of home healthcare so far including Lifeline Systems, Health Watch and Raytel Cardiac Services.

Vimpel Communications has agreed to pay $4.3 billion or $105 per share for Golden Telecom. The offer price of $105 per share represents a premium of 3.5% to the closing price of Golden Telecom common stock on November 30, 2007, the business day before Golden Telecom and VimpelCom announced that they were in negotiations regarding a potential transaction, and a premium of 10.1% and 27.6% to the average closing price of Golden Telecom common stock over the previous 60 and 120 days, respectively.

The VimpelCom Group includes companies operating in Russia, Kazakhstan, Ukraine, Uzbekistan, Tajikistan, Georgia and Armenia. The VimpelCom Group''s GSM and 3G license portfolio covers a territory with a population of about 250 million including Russia, Kazakhstan, Ukraine, Uzbekistan, Tajikistan, Georgia and Armenia.

Merrill Lynch ((MER)) jumped 3% after the Wall Street Journal reported that it is in advanced talks with Singapore controlled investment fund Temasek. Merrill is expected to receive an investment of $5 billion if the deal is consummated.

The recent mortgage market meltdown has depleted capital base of many large banks and brokerage houses. UBS, Citigroup, Bear Stearns, and Morgan Stanley are just few of the large financial services firm that have accepted investment from investors in Asia and Middle East.

Research in Motion ((RIM)) reported sharply higher revenue and earnings in the third quarter from a year ago and from the second quarter of this year. The maker of popular BlackBerry mobile communication devices jumped 10% or $12.09 to $119.18 after it reported revenue and earnings rise of more than 100%.

Circuit City ((CC)) fell $1.41 to $5.25 after it reported higher than expected loss and declining revenue. Revenue in the quarter declined to $2.96 billion from $3.06 billion and loss increased to $207.3 million from $20.4 million. Loss per share increased to 7% of net sales to $1.26 from 12 cents or 0.7% of net sales in the previous year.

Walgreen Co ((WAG)) reported fiscal first quarter 2008 earnings increase of 5.5% to $456 million or 46 cents per share from $432 million or 43 cents per share. Revenue in the quarter rose 10.4% to $14 billion. Comparable same store sales in the quarter rose 5.4% and front end drug store sales rose 4.6%.

Netsuite ((N)) jumped 20% a day after it priced 6.2 million shares at $26 per share.

The Commerce Department reported that November personal consumption increased 1.1% from October.