General Electric (GE) agreed today to buy British medical firm Amersham for £5.7 billion sterling ($9.5 billion) to boost growth.
The 800 pence per share all-stock deal is the biggest in Britain this year and the latest in a series of health sector takeovers as firms seek critical mass in a fragmented industry.
GE's Frankfurt-traded shares were 3.5 per cent lower at 25.25 euros by early afternoon. Shares in Amersham, which announced on Wednesday it was in takeover talks with a mystery suitor, were up 15 per cent at 757 pence.
GE Chief Executive Mr Jeffrey Immelt has orchestrated a string of deals to drive the company into fast-growing industries as other parts of its empire come under pressure.
Economic weakness has affected demand for power turbines, its aero-engine arm has been hit by an air travel slump while higher costs have crimped earnings in plastics.
On Wednesday, GE signed a deal for its NBC television unit to take over Vivendi Universal's entertainment arm.
The Amersham acquisition brings together two complementary businesses, as GE makes medical scanners that use Amersham's diagnostic agents, which are injected into patients to detect disease.
Mr Immelt said buying Amersham, the first enterprise to be privatised by Mrs Margaret Thatcher's government in the 1980s, would help the US firm expand its fast-growing high-technology medical business.