Medidata (MDSO) To Be Acquired By Dassault For $5.8 Billion

Medidata Solutions, Inc. (NASDAQ:MDSO) recently announced that it is getting acquired by French Technology stalwart Dassault Systèmes in an all-cash transaction at a price of $ 92.25 per share, representing an enterprise value of $5.8 billion. The acquisition is expected to close by the end of 2019.

Following the announcement, shares of Medidata inched up 0.1% to close at $91.45 on Jun 13. Investors at Medidata consider this to be strategic since the offer value was at 1.2% premium to the company’s closing price just before the news surfaced. Also, the deal value is higher than Medidata's current market cap of $5.49 billion.

With this acquisition, Dassault Systèmes will reinforce its position as a provider of an end-to-end approach to research and development in the healthcare industry. For investors’ notice Dassault Systèmes is a world leader in 3D design and engineering software, helping bring about sustainable innovation.

Medidata Solutions currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Over the past year, the stock has gained 11.3% compared with the industry’s 3.8% rise. The stock has also performed favorably when compared with the S&P 500 index’s 4.9% increase.

How Will the Industry Gain?

Medidata Solutions’ market-leading clinical cloud solutions are used by customers to develop therapeutic innovation. They also complement Dassault’s healthcare solutions on its flagship 3DEXPERIENCE collaborative platform.

Through this acquisition, the healthcare industry will benefit from Medidata’s flagship platforms, thereby boosting drug research and discovery, development, clinical testing, manufacturing and commercialization.

Major U.S. Healthcare M&A Making Waves

Mergers and acquisitions have been the key driver of the U.S. healthcare space lately. Value-based reimbursement, shrinking hospital margins and record-high healthcare spending are pushing providers to consider new partnerships to achieve efficiency and cost control.

Recently, leading DNA sequencing company Illumina (NASDAQ:ILMN) announced the signing of an acquisition agreement to buy its fellow genomics company, Pacific Biosciences of California.

Also, in the recent past, MedTech bigwig Becton, Dickinson and Company’s acquisition of C. R. Bard and JOHNSON & JOHNSON’s (NYSE:JNJ) buyout of Actelion deserve a mention.

A Key Pick

A better-ranked stock in the broader medical space is DENTSPLY SIRONA (NASDAQ:XRAY) , carrying a Zacks Rank #2 (Buy).

DENTSPLY’s long-term earnings growth rate is expected at 11.5%.

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