Boston Scientific to buy Silk Road Medical in $1.16 billion deal

By Sriparna Roy

(Reuters) -Boston Scientific will buy Silk Road Medical in a $1.16 billion deal, the company said on Tuesday, adding medical devices used for stroke prevention.

Boston, which generates most of its revenue from sales of heart devices such as pacemakers and stents, will pay $27.50 for each share of Silk Road held, representing a premium of 27% to the stock's last close.

Shares of Silk Road rose nearly 24% to $26.79 in premarket trading.

Silk Road's technology is used to prevent stroke in patients with carotid artery disease, a condition in which plaque builds up in the vessels that supply blood to the brain.

The minimally invasive procedure, called transcarotid artery revascularization (TCAR), temporarily reverses blood flow to divert the plaque build up away from the brain. A stent is then placed at the blockage site for plaque stabilization and future stroke prevention.

The deal follows Boston's $3.7 billion buyout of Axonics, which gave it access to devices used to improve bladder function. In April, the U.S. Federal Trade Commission requested additional information regarding the buyout.

At least three analysts said the Silk Road deal was complementary to Boston's portfolio.

The Massachussets-based company can help increase TCAR penetration within the U.S., launch new products, and expand into new markets such as Japan and China, said BTIG analyst Marie Thibault.

Boston Scientific expects to complete the transaction in the second half of 2024, after which Silk Road will operate as a wholly-owned unit. Silk Road has forecast net revenue of about $194 million to $198 million for this year.

The deal will have no material impact on its per share profit for this year and 2025, Boston Scientific said.

(Reporting by Sriparna Roy in Bengaluru; Editing by Sriraj Kalluvila)