VAR stock began running up on Friday, July 31, 2020, ahead of its reported earnings and revenue beats on Sunday, August 2, 2020. The company also announced that it will be acquired for $177.50 per share.
Varian (NYSE: VAR) today announced its third quarter fiscal year 2020 results. Varian reports Q3 EPS of 78c versus the consensus estimate of 52c. The company reported Q3 revenue of $693.4M versus the consensus estimate of $664.38M. In light of the announced transaction with Siemens Healthineers, Varian has cancelled its Q3 earnings conference.
Varian (VAR) announced that it has entered into a definitive agreement to combine with Siemens Healthineers (SMMNY) in an all-cash transaction valued at $16.4B on a fully diluted basis. Under the terms of the agreement, which has been unanimously approved by Varian’s board, Siemens Healthineers will acquire all outstanding shares of Varian for $177.50 per share in cash, representing a premium of 24% to the closing price of Varian’s common stock on July 31. The transaction is expected to close in the first half of 2021, subject to approval by Varian shareholders, receipt of regulatory approvals and other customary closing conditions. “The combination will create a multi-disciplinary global healthcare leader with the most comprehensive cancer care portfolio in the industry. The combined company will offer an integrated platform of end-to-end oncology solutions to address the entire continuum of cancer care, from screening and diagnosis to care delivery and post-treatment survivorship. By bringing together the highly complementary diagnostic tools, imaging, radiotherapy and AI capabilities across both companies, Varian and Siemens Healthineers will lead the digital transformation of oncology healthcare, enabling more efficient diagnosis, increased treatment quality and access, personalized precision cancer care, and improved outcomes for millions of patients worldwide,” Varian said in a statement.
Third Quarter 2020 Summary
- Operating performance reflects a full quarter of COVID-19 impact across all geographies
- Oncology Systems gross orders down 14% in dollars and in constant currency in the quarter; trailing twelve months gross orders grew 1% in dollars and in constant currency
- 7 EthosTM orders received, including 5 in North America and 2 in Europe, bringing total orders since launch to 38 units
- Total company revenues down 16% in dollars and 15% in constant currency, to $694 million; organic revenues down 19%(1)
- GAAP operating earnings grew 11% at 8.6% of revenues; non-GAAP operating earnings declined 32% at 14.1% of revenues
- GAAP net earnings per diluted share of $0.67; non-GAAP net earnings per diluted share of $0.78
“I am proud of the team’s execution during the quarter, especially given the challenging operating backdrop created by the pandemic,” said Dow Wilson, President and Chief Executive Officer of Varian. “Our continued investments in our strategic enablers, combined with our strong financial standing, position us well to exit the pandemic stronger, and extend our global leadership in oncology. In addition, we are pleased to announce a transaction with Siemens Healthineers – delivering immediate and compelling value to our shareholders, while bringing us even closer to realizing our transformative vision. Our innovative and patient-centric culture has enabled us to become an iconic leader in radiotherapy and multi-disciplinary cancer care, with a trusted global brand and strong customer loyalty. We are thrilled to partner with Siemens Healthineers to extend our renowned customer care, serving clinicians and patients from the very first stage in the fight against cancer.”