Mallinckrodt Inc. Offers 36% Premium for Nellcor Puritan

Mallinckrodt Group Inc. said it will offer $28.50 a share in cash for Nellcor Puritan Bennett Inc., a 36% premium to Nellcor’s closing price on Wednesday of $20.94.

St. Louis-based Mallinckrodt’s hospital products include X-ray contrast media, radiopharmaceuticals and devices for imaging. Nellcor, based in Pleasanton, Calif., provides medical products for the home and hospital that monitor, diagnose and treat patients with respiratory impairments.

“Based on our expectations for revenues and synergies, we would expect the transaction to be accretive to earnings per share in fiscal year 1999,” said C. Ray Holman, chief executive of Mallinckrodt, in a statement.

C. Raymond Larkin Jr., chief executive of Nellcor, will become Mallinckrodt’s executive vice president and remain head of the Nellcor subsidiary, which will by combined with Mallinckrodt’s critical-care unit, Mallinckrodt said.

Nellcor executives did not immediately return calls.

Mallinckrodt shares fell 50 cents to close at $39.75 on the New York Stock Exchange. Nellcor trades on Nasdaq.