MW Becton Dickinson gets its spinoff deal, but the stock is still falling

By Tomi Kilgore

The stock has slumped since plans to separate its bioscience and diagnostic business were announced, but the medtech company has blamed government policy for sales weakness

Shares of Becton Dickinson and Co. dropped in early Monday trading after the medical-products company announced a deal to merge its biosciences and diagnostic business with Waters Corp.

The deal, which the companies said was valued at approximately $17.5 billion, comes about five months after Becton Dickinson $(BDX.SI)$ announced plans to separate the business, which the company said at the time would allow it to enhance its focus and drive growth.

After the plans were made public after the Feb. 5 close, the stock had dropped 7.3% on Feb. 6 and has tumbled 28.2% through Friday. And after the separation was announced Monday, the stock fell another 2.3% in premarket trading, even after the company said it plans to spend at least $2 billion it receives from the deal to repurchase shares.

Waters's stock $(WAT.AU)$ slid 5.1% in Monday's premarket.

There has been more to the selloff in BD shares than just the spinoff plan.

On May 1, the stock had plunged 18.1%, the biggest one-day selloff in 26 years, after the company issued a profit and sales warning, citing changes to government policy. The company said cuts to U.S. research grants would hurt sales, and said tariffs announced by the Trump administration would take a bite out of earnings.

Before Monday's separation deal, the stock had recovered 6.6% since it closed at an eight-year low of $165.15 on May 5. Becton Dickinson's Chief Executive Tom Polen said the company would be able to focus on medical technology after the deal, and help boost long-term shareholder value.

Under terms of the deal with Waters, the biosciences and diagnostic business will be spun off to Becton Dickinson's shareholders, and at the same time merged with a Waters subsidiary. BD shareholders will own 39.2% of the combined company and Waters shareholders will own the rest.

BD will receive $4 billion in cash before the merger is completed, which is expected to occur around the end of the first quarter of 2026. Waters will also assume about $4 billion of debt.

Polen said the company is committed to using "at least half" of the cash proceeds to buy back stock, and the rest will be used to pay down debt.

BD's stock has shed 22.4% in 2025 through Friday, while Waters's stock has slipped 4.9%. The Health Care Select Sector SPDR ETF XLV, of which both stocks are components, has eased 1.7% this year and the S&P 500 index SPX has gained 6.4%.

-Tomi Kilgore

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July 14, 2025 07:48 ET (11:48 GMT)

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