Merit Medical Systems, Inc. has announced the signing of a definitive asset purchase agreement with Pentax of America, Inc., a subsidiary of Pentax Medical, Inc., to acquire the C2 Cryoballoon™ device and related technology. The proposed acquisition is expected to strengthen Merit's position in the gastroenterology market and provide opportunities to treat more patients suffering from chronic gastroesophageal reflux disease (GERD) and other gastrointestinal tissue disorders.
The financial summary of the acquisition includes a total purchase consideration of $22 million, consisting of a $19 million cash payment at closing and potential contingent payments of up to $3 million payable upon meeting certain milestones. The acquired assets are projected to contribute revenue of approximately $1 million from the projected closing date of November 1, 2025, through December 31, 2025. However, during the same period, it is projected to dilute Merit’s previously forecasted non-GAAP net income and non-GAAP earnings per share by approximately $0.4 million and $0.01, respectively. The acquisition is also projected to be dilutive to Merit’s full-year 2025 GAAP net income and GAAP earnings per share by approximately $0.5 million and $0.01, respectively.
Looking ahead, the proposed acquisition is projected to contribute revenue in the range of approximately $6 million to $8 million for the twelve months ending December 31, 2026. However, it is expected to be dilutive to Merit’s non-GAAP net income and non-GAAP earnings per share in the range of approximately $1 million to $2 million, or $0.02 * $0.03 per share, respectively. The proposed acquisition is also projected to be dilutive to Merit’s GAAP net income and GAAP earnings per share in the range of approximately $2 million to $3 million, or $0.03 * $0.05 per share, respectively. Non-GAAP net income and non-GAAP earnings per share are non-GAAP financial measures.
The acquisition is expected to expand Merit’s endoscopy portfolio with an innovative device to treat patients suffering from Barrett's esophagus and other gastrointestinal disorders, with the potential to add approximately $6 million to $8 million of revenue in 2026 in the gastroenterology market. As a result of these announcements, the company's shares have moved 0.42% on the market, and are now trading at a price of $80.81. Check out the company's full 8-K submission here.
