Tyco Will Buy AHP Unit for $1.77 Billion

Tyco International Ltd. on Monday said it will buy American Home Products Corp.’s medical supplies unit for $1.77 billion, adding catheters, needles and syringes to its hospital supplies.

AHP’s Sherwood-Davis & Geck unit has about $1 billion in annual revenue, half of it generated outside the U.S.

Tyco has been on a shopping spree this year, spending more than $9 billion to buy businesses in its four main divisions.

Tyco’s Kendall unit sells products for wound care, incontinence, anesthetic care and other medical needs.

“This will make Tyco the leader in the disposable medical products area,” said Michael Jaffe, an analyst with Standard & Poor’s.

In a press release, the company said the purchase would immediately add to earnings, although it didn’t say by how much.

Tyco has been buying up diverse businesses in the last year, more than doubling its annual revenue to an estimated $12 billion in fiscal 1998, ending Sept. 30, from $5.1 billion in fiscal 1996.

Tyco’s largest purchase this year was ADT Ltd., the biggest provider of electronic security systems in the U.S., for about $7 billion in July.

Shares in Tyco, based in Exeter, N.H., rose $1.94 to close at $42.88 on the New York Stock Exchange. American Home, based in Madison, N.J., rose 75 cents to close at $74.88, also on the NYSE.