Silk Road Medical to be acquired by Boston Scientific, shares surge 24% By Investing.com

Boston Scientific (NYSE:) is acquiring Silk Road Medical (NASDAQ:) for $1.16 billion.

The deal, revealed on Tuesday, will see Boston Scientific pay $27.50 per share of Silk Road, marking a 27% premium over the stock’s last closing price.

SILK shares surged more than 24% following the market open on Tuesday.

Silk Road Medical develops a technology focused on preventing strokes in patients with carotid artery disease, which involves plaque buildup in the vessels supplying blood to the brain.

This acquisition comes on the heels of Boston Scientific’s $3.7 billion purchase of Axonics, a company known for devices that enhance bladder function.

Boston Scientific expects to finalize the Silk Road transaction in the second half of 2024, after which Silk Road Medical will become a wholly-owned subsidiary. Silk Road projects its net revenue for this year to be between $194 million and $198 million.

Despite the acquisition, Boston Scientific expects no material impact on its per-share profit for 2024 and 2025.

“We expect SILK to be accretive to the overall BSX portfolio, with double-digit revenue growth (+28% y/y) and ~72% gross margin last year,” analysts at BTIG said in a note after the announcement.

“We think BSX can use its resources to increase transcarotid artery revascularization (TCAR) penetration within the U.S., launch new products, and expand into new markets, including Japan and China, while continuing to improve the business’ margins,” they added.

Elsewhere, analysts at Stifel said they view the deal as a positive for both companies.

“Silk Road helps expand the BSX Peripheral Interventions portfolio, and for SILK, Boston’s significant financial and marketing resources can help drive TCAR to the next level of adoption,” they noted.