The health care giant is instead focusing on slashing debt from its recent purchases, according to chairman and CEO Miles D. White.
"I'm not out looking for M&A, and I don't have any significant M&A on the radar screen," White said on an earnings call on Wednesday, Jan. 24. "Frankly, I don't have any M&A on the radar screen because I want to hit those debt targets by year-end."
In October, Abbott completed its acquisition of diagnostics firm Alere Inc. for $51 per share, or $5.3 billion in equity value. And in January of last year, Abbott wrapped up its $33 billion purchase of St. Jude Medical Inc., a maker of heart-failure devices and technology.
"[We] were up to a gross $28 billion of debt because of our acquisitions of St. Jude and Alere and a little bit of lingering debt we had just over time," White said on the call.
That number has gone down by $4 billion following a debt repayment this month. White said the company will probably repay an additional $3.5 billion to $4 billion in the next six months, bringing its debt down to $20 billion by year end.
"We have already exceeded the targets that the rating agencies had for us," he said, adding that the company's debt-to-Ebitda ratio will be below three times at year end, and below two times on a net debt basis.
Commenting on the new tax bill, White said he was pleased with how it turned out. "As a multinational and a company that had a lot of debt in the last two years because of the acquisitions, I had concerns about some of the structures they were looking at. But it all turned out pretty good," he said.
Abbott's fourth-quarter results exceeded analysts' estimates, with the company reporting adjusted diluted earnings from continuing operations of 74 cents per share on revenue of $7.6 billion. Analysts had forecast adjusted EPS of 73 cents on revenue of $7.38 billion, according to Bloomberg. For 2018, the Abbott Park, Ill.-based company projected adjusted EPS from continuing operations of $2.80 to $2.90.
Shares of Abbott rose 4% on Wednesday morning to $61.62, and are up 52% over the last 12 months.
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