Strategic Merger Between BD and Waters Corporation
Becton, Dickinson and Company (BD) has entered into a definitive agreement to merge its Biosciences & Diagnostic Solutions business with Waters Corporation in a landmark deal valued at approximately $17.5 billion. This merger is set to create a powerful new entity in the life science and diagnostics industry, combining the strengths of two leading companies.
The Deal Structure and Key Benefits
The transaction is structured as a Reverse Morris Trust, allowing both companies to combine their operations while maintaining separate legal entities during the transition. This approach is expected to provide significant advantages, including streamlined integration and enhanced operational efficiency.
The merger is anticipated to double Waters’ total addressable market to around $40 billion by integrating complementary technologies such as diagnostic solutions, mass spectrometry, liquid chromatography, and flow cytometry. These technologies are critical for advancing research and development in the life sciences sector.
More than 70% of the new entity’s revenue is expected to be recurring annually, indicating a strong foundation for long-term growth. The bioseparations portfolio will particularly benefit from the combined expertise of Waters’ chemistry knowledge and BD’s biologics experience, driving innovation in biologics and emerging therapeutic modalities.
Strategic Advantages and Synergies
Waters’ LC-MS technologies will play a key role in enhancing multiplex diagnostics, supported by BD’s regulatory expertise and presence in clinical environments. This collaboration is expected to improve market access, accelerate menu expansion, and enhance service support and automation in diagnostic applications.
The companies anticipate substantial cost and revenue synergies. By the fifth year post-closing, they expect around $200 million in cost synergies and about $290 million in revenue synergies. These benefits are projected to result in approximately $345 million in annualised EBITDA synergies by 2030, driven by optimisations in supply chain, manufacturing, and SG&A expenses.
Ownership and Financial Implications
Following the merger, BD shareholders will own approximately 39.2% of the combined entity, while current Waters shareholders will hold 60.8%. Before the merger’s completion, BD will receive a $4 billion cash distribution. Waters will assume about $4 billion in incremental debt, resulting in a net-debt-to-adjusted EBITDA leverage ratio of 2.3× at closing.
Leadership and Operational Structure
The new entity will be led by Waters’ president and CEO, Udit Batra, with Amol Chaubal serving as chief financial officer and senior vice-president. The combined company will retain the Waters name and maintain its headquarters in Milford, Massachusetts, US. It will also continue to operate in key locations previously associated with BD’s Biosciences & Diagnostic Solutions division.
Advisory Teams and Regulatory Process
Barclays is acting as Waters’ financial adviser, while Kirkland & Ellis serves as legal counsel. Citi is the lead financial adviser for BD, with Evercore also providing advisory services. BD’s lead legal counsel was represented by Wachtell, Lipton, Rosen & Katz.
Vision for the Future
BD president, chairman, and CEO Tom Polen emphasized the cultural alignment between the two companies, stating that Waters offers the right environment for BD’s Biosciences & Diagnostic Solutions team to thrive. He highlighted the potential for continued innovation and meaningful impact on global healthcare.
This merger marks a significant step forward for both companies, combining their strengths to drive growth, innovation, and value in the life science and diagnostics sectors. With regulatory and shareholder approvals pending, the transaction is expected to close by the end of the first quarter of 2026.
