Smiths Group PLC (LON:SMIN) was a top riser on the FTSE 100 on Tuesday following a media report that US healthcare firm ICU Medical offered up to £2.8bn for the British industrial conglomerate’s medical division.
ICU, which makes devices used in infusion therapy and oncology, has tried to revive talks with Smiths after the UK firm turned down a written offer for its medical business last month, Sky News reported.
READ: Smiths Group to abandon discussions over £7bn medical division merger with ICU Medical: report
The deal was made up mostly of cash and partly of ICU stock and would have valued Smiths Medical at between £2.5bn and £2.8bn.
The bid was made after reports that the two companies were close to ending talks on the creation of a £7.5bn global company.
While Smiths turned down the offer from ICU, the two are understood to be continuing talks, given the absence of a stock exchange announcement to the contrary.
Smiths, which has been in discussions with ICU since May after rocky performance in its medical arm, is expected to update the market on its position when it reports its full-year results on September 21.
In a full year trading update in July, Smiths said its medical division was likely to post a 2% revenue decline due to some products losing certifications under a new regulation and the loss of two contracts in the US. The unit accounts for just under 30% of the group's revenues.
READ: Smiths Group returns to growth but medical arm disappoints
Smiths has five main divisions, which also include security detection and John Crane, a provider of engineering solutions for energy and other process industries.
The company’s complex structure has long been a concern for some shareholders and in recent months, there has been growing speculation of an activist investor pressing for a break-up.
Shares gained 1.4% to 1,641p in mid-morning trading.