ICU Medical Under Review on Smiths Acquisition; FVE Likely to Rise

Narrow-moat ICU Medical announced plans to acquire narrow-moat Smiths Group’s Medical division for $2.35 billion in enterprise value in a transaction expected to close in the first half of 2022. We believe the acquisition will be substantially accretive for ICU, and shares have risen over 30% in intraday trading. At first glance, we expect to significantly raise our fair value estimate too, and we are placing ICUI under review as we rework our model to account for the acquisition.