Shares of Omnicell (OMCL) - Get Omnicell, Inc. Report jumped Wednesday following a report that said the medication-management-software vendor received a takeover approach from medical-supplies giant Baxter International (BAX) - Get Baxter International Inc. Report at more than $120 a share.
Baxter approached Omnicell with an offer to acquire the company for more than $5 billion, sources told Reuters.
There is no certainty that Omnicell, Mountain View, Calif., will engage in discussions or that a deal will be reached, Reuters reported.
Omnicell shares at last check rose 8.3% to $119. Shares of Baxter International, Deerfield, Ill., rose 1.4% to $78.90.
Baxter shares are down about 5% year to date while Omnicell shares are up more than 40% in 2020.
In the wake of the report, Benchmark lifted its price target for Omnicell to $125 from $100.
Cantor Fitzgerald also published a note saying that adding Omnicell would be an "upgrade to Baxter's current portfolio."
Additionally, Becton Dickinson (BDX) - Get Becton, Dickinson and Company Report, one of Baxter's rivals, owns Pyxis, which is Omnicell's only primary competitor, according to Cantor Fitzgerald analyst Steven Halper. Becton Dickinson shares were little changed at $239.53.
"Baxter could easily acquire Omnicell given its financial position," Halper said. But he also says a takeover approach hasn't yet been confirmed.
Omnicell provides a range of services that help hospitals and health-care companies handle their prescriptions. Baxter provides health-care products, including artificial kidneys and insulin, for use in hospitals.
The medical-device market has been hot in recent weeks. Medical-imaging provider Butterfly Network said it planned to go public through a merger with Longview Acquisition, LGVW a special-purpose-acquisition company.