Investopedia: Endo Choosing The Less Traveled Path

Investors may not realize it, but there was a time when a lot of large pharmaceutical companies had device businesses as well. Most companies decided it was better to focus around their branded drugs, though, and sold or spun-off those businesses, leaving a few companies like Johnson & Johnson (NYSE:JNJ) and Abbott (NYSE:ABT) as the exceptions.

Endo Pharmaceuticals (Nasdaq:ENDP) seems to be comfortably swimming against the tide, though. As this smaller pharmaceutical company works to diversify its model and find multiple growth opportunities ahead of generic competition for its key product Lipoderm, the company is looking to devices as part of its future.

The company announced another big move on Monday - the acquisition of urology device specialist American Medical Systems (Nasdaq:AMMD).

Terms of the Deal
Endo is paying $30 a share for American Medical, better than a 34% premium to Friday's closing price. Under the deal, Endo will be paying all cash for the device company, and assuming over $300 million in AMMD debt - bringing the total deal value to about $2.9 billion.


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