Abbott’s Mylan Billions Open Door for Bigger Purchases: Real M&A - (Bloomberg via NewsPoints Desk)

  • Abbott Laboratories is Mylan's largest holder after swapping its established-markets drug business for Mylan stock earlier this year, reported Bloomberg, adding that Mylan's rising stock as it pursues Perrigo and tries to ward off a takeover by Teva have boosted the value of Abbot's stake to about $5 billion.
  • Analyst Jeff Windau of Edward Jones & Co. suggested Abbott investors "might get a little noisier about what the next steps are several quarters out if they don't start to see how that money is being spent…You're going to see potentially more questions to management."
  • George Strietmann of Bahl & Gaynor said "they certainly have room to do a fairly good-sized acquisition," suggesting a potential purchase range of $2 billion to $4 billion, while Bloomberg Intelligence analyst Jonathan Palmer says Abbott has the ability to do an acquisition of up to about $25 billion.
  • Jeff Jonas, a fund manager at Gabelli, suggested that if Abbott CEO Miles White wanted to be bold, he could transform the company into a "cardiovascular powerhouse" with an acquisition of St. Jude Medical, which has a market value of $20 billion.
  • Edwards Lifesciences, a $13-billion company, is another big acquisition target that would potentially bolster Abbott's cardiovascular business, said Igor Golalic of Diamond Hill Capital Management.
  • Meanwhile, another possibility would be to go up against Mylan in the pursuit of Perrigo, with Kyle Bass of Hayman Capital Management saying Abbott would be a better acquirer of the $30-billion company.

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