The news came from The Wall Street Journal, which cited knowledgeable sources.
Baxter, the Deerfield, Ill., medical-technology company, would fork out about $150 a share for Hill-Rom, Chicago. And a deal may be reached by midweek, the sources said.
Hill-Rom recently traded at $143.99, up 8%; and Baxter traded at $75.35, up 0.51%. Hill-Rom gained 24% in the six months through Friday, while Baxter slid 5%.
In July, Baxter bid $144 a share, for Hill-Rom but was turned down.
Healthcare acquisitions have totaled $399 billion year to date, more than twice the year-earlier level, according to Dealogic, The Journal reports.
Last month, Morningstar analyst Julie Utterback put fair value at $80 for Baxter.
“Narrow-moat Baxter mildly beat adjusted EPS expectations in the second quarter and raised the bottom end of its adjusted EPS guidance range for 2021,” she wrote in a commentary.
“However, this mild increase in near-term profit trends does not substantially affect our $80 fair value estimate.”
Baxter "has dug a narrow moat around providing dialysis and injectable therapies through complex delivery systems,” Utterback said.
“It can claim top-tier positions in most of its product lines and typically competes with a concentrated group of peers.
“Overall, we think it would be difficult for new firms to enter these niches primarily due to the switching costs associated with some of its medical equipment and the intangible assets surrounding its proprietary technology and manufacturing processes. “