ITMR Stock: The $538M Reason Why Itamar Medical Is Soaring 45% on Monday

Investors who hold shares of ITMR stock woke up to some great news this morning. Today, Itamar Medical (NASDAQ:ITMR) confirmed that all its outstanding shares will be collectively acquired by ZOLL Medical. For the latter, a medical device and software manufacture owned by Asahi Kasei, this acquisition will mean the opportunity to expand its reach into a growing market within the medical treatment field.  Shares of its new partner’s stock have reacted well to the news of the definitive agreement.

Man suffering from sleep apnea.

Source: tommaso79/

ITMR Stock: What Happened?

Since news broke of the acquisition, shares of ITMR stock have risen 45.42% as of this writing. This comes after a month of steady growth which has seen the price of ITMR stock rise more than 70%.

The terms of the acquisition dictate that all outstanding shares of ITMR stock be purchased by ZOLL for “$31 per American Depository Share (ADS), or $1.03 (equivalent to approximately NIS 3.31) per ordinary share, in cash,” adding up to a price tag of roughly $538 million.

Shareholders with ITMR stock have voted unanimously to approve the decision. Pending no further regulatory delays, the deal is expected to close by the fiscal end of 2021

Not Sleeping on This Deal

For companies like ZOLL, this type of acquisition is often an opportunity to gain a foothold and establish their presence in a previously untapped market within their sector. This particular deal is no different.

Itamar Medical has been a pioneer in the development and commercialization of non-invasive medical respiratory sleep treatments. In fact, it is known primarily for the WatchPAT Home Sleep Apnea Device. Fully cleared by the U.S. Food and Drug Association, the device has proven monumental in the field of at-home sleep apnea testing, garnering recognition from the medical community.

Since ZOLL is a company that deals primarily in cardiopulmonary issues, the acquisition of Itamar is a logical step forward.

What Comes Next for ITMR Stock

As of now, there is no reason to believe that this acquisition will be anything less than a boon to ITMR shareholders. In fact, the deal comes at a 50% premium to the Sept. 10 price of ITMR stock. While shareholders and regulators will still have to approve the transaction, there is little reason to believe they will veto the deal.

According to data from the American Heart Association, the amount of cardiovascular patients with some type of sleep apnea, ranges between 40% and 80%. Even if that percentage stays closer to the lower end, it still demonstrates a significant need for the type of technology produced by Itamar among the type of patients ZOLL is used to producing devices for.

These two companies should fit together well as they continue to address a growing market need within the medical community.  Investors in ITMR stock should maintain a healthy optimism that this deal will close favorably by the end of 2021.

On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

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