* Q1 revenue, profit beat estimates
* Maintains its 2017 forecast
* Closing of new Alere deal is a little unpredictable - CFO
(Adds conference call details; Updates shares)
By Natalie Grover and Akankshita Mukhopadhyay
April 19 Abbott Laboratories said it was
looking to close the recently revised deal to buy Alere Inc
in the coming months, calling the diagnostics company "a
bit of a fixer-upper".
Abbott, which reported first-quarter sales and profit ahead
of analysts' estimates on Wednesday, first revealed an agreement
to buy Alere in February 2016. But the deal ran into trouble as
issues related to Alere's accounting and sales practices came to
However, last week, Abbott agreed to the takeover at a price
of around $5.30 billion down from $5.80 billion, ending the
prolonged legal tussle.
Alere has had some challenges and closing the deal is going
to be a bit unpredictable, because Alere still needs to file its
annual report and Abbott is required to divest some businesses
for regulatory approvals, Abbott CFO Brian Yoor said on a
post-earnings conference call.
The Alere deal is now expected to close in the third
quarter, and will help Abbott expand in point-of-care diagnostic
testing, a market that is rapidly growing as physicians
increasingly adopt tests that speed up treatment.
Abbott has been considerably active on the M&A front. Last
year, it agreed sell its medical optics division to Johnson &
Johnson for $4.3 billion, and closed its $25 billion
acquisition of St. Jude Medical this January.
The company's first-quarter net sales rose 3.2 percent on an
operational basis to $6.34 billion, above the average analyst
estimate of $6.15 billion, according to Thomson Reuters I/B/E/S.
While sales in its diagnostics, medical devices and branded
generic pharmaceuticals divisions grew in the quarter ended
March 31, Abbott's nutrition business continued to suffer.
Global nutrition sales dipped 1 percent on an operational
basis, hurt mainly by continued challenges in the Chinese infant
New food safety regulations in China require manufacturers
to re-register baby formulas with the government.
"As the government transitions through these new
regulations, I think that's going to be a little bumpy and it
has been... but I think we feel pretty good about China for the
long term," Abbott CEO Miles White said.
Excluding items, Abbott earned 48 cents per share, beating
the average analyst estimate by 5 cents.
Shares of the diversified healthcare company, which also
maintained its 2017 forecast, were little changed in afternoon
trading. As of yesterday's close, Abbott's stock had risen
nearly 15 percent since it announced the Alere deal in February
(Reporting by Natalie Grover and Akankshita Mukhopadhyay in
Bengaluru; Editing by Martina D'Couto)