Bard’s cash offer of $262 million is a 37 percent premium over the company’s market value.
Rochester Medical Corp., a maker of catheters in suburban Rochester that quintupled in size over the past decade to more than $60 million in annual sales, said Wednesday that it would be acquired for $262 million by C.R. Bard Inc., the New Jersey medical device giant that bought another Minnesota company last month.
Bard’s cash offer of $20 per share for Rochester Medical represented a 37 percent premium over the company’s average market value over the past three months.
In response to the news, shares in Rochester Medical jumped 44 percent, or $6.10, to $19.91 on the Nasdaq Stock Market, a level not reached since March 2007. Bard shares rose 1.8 percent, or $2.07, to $116.73.
In a statement, Anthony J. Conway, the chief executive officer and a co-founder of Rochester Medical, said the deal “represents an attractive valuation” and was a “great opportunity” for both companies. The Rochester Medical board approved the offer, which is now subject to a shareholder vote. The companies aim to close the deal by the end of the year.
Conway, along with his brother Philip and colleague Richard Fryar, started the company in 1988 and introduced their first major product, silicone self-adhering external catheters for men, in 1990. They took the company public in 1991 and sales grew slowly over the next decade, passing $10 million for the first time in 2002.
Over the past decade, sales grew quickly as Rochester Medical developed a broad line of catheters and other urinary care products. In 2012, the firm employed about 400 people and reported a $4.2 million profit on $65 million in sales.
By 2018, an estimated 1.1 billion people worldwide will be affected by some form of lower urinary tract or bladder outlet obstruction, Bard said in its statement about the deal. Bard said Rochester Medical would help it expand into the market for health care products used at home or after hospital visits.
“Rochester’s double-digit growth product portfolio, including their customer access programs, is a key building block in our strategy to access faster-growing markets over the long term,’’ Timothy Ring, Bard’s chairman and CEO, said in the statement.
Bard last month announced a deal to buy Medafor Inc., a Brooklyn Center-based maker of a novel blood clotting product, for $200 million in cash and up to $80 million more if future sales goals are met.
Evan Ramstad • 612-673-4241