A demonstration of robotic surgery
The bid, for $30 a share, is an 86% premium to Mako's prior closing price and 10-times projected 2014 revenue. Mako, incidentally, is a not-yet-profitable company that appeared overvalued enough to professional investors that 25% of its shares had been sold short.
MAKO shares in midday trade were up 82% to $29.50. Stryker shares, meanwhile, dipped only around 2% to $69.10, shedding less than half the value of the Mako deal and retaining nearly all the stock’s 27% gain this year through Tuesday.
Not a unique response
Typically, acquirers' shares are reflexively punished upon unveiling a deal, to account for the premium paid, dilution of existing shareholders and risks of making buyouts pay off. But investor equanimity in response to a company making a bold, expensive acquisition is notRead More »from Stryker Pays Up for Mako. Are the M&A Sharks Back?