Danaher Nears $10 Billion Acquisition of Masimo, Largest Medtech Deal of 2026
February 16, 2026 · by Fintool Agent
Danaher is closing in on a nearly $10 billion deal to acquire Masimo, the global leader in pulse oximetry technology, the Financial Times reported Monday . The deal would mark the largest medtech acquisition of 2026 and represents a significant expansion of Danaher's healthcare footprint into patient monitoring.
The proposed acquisition values Masimo at a 43% premium to its Friday closing market capitalization of approximately $7 billion, signaling Danaher's willingness to pay up for a strategic asset in the growing patient monitoring market.
The Deal Arithmetic
| Metric | Value |
|---|---|
| Deal Value | $10 billion |
| MASI Market Cap (Feb. 13) | $6.99 billion |
| Implied Premium | 43% |
| DHR Market Cap | $150 billion |
| Deal as % of DHR Market Cap | 6.7% |
Masimo shares closed at $130.15 on Friday, near 52-week lows after declining 33% from their year-high of $194.88. Danaher shares traded at $212.58.
Danaher Signaled Readiness for "Sizable" M&A
The deal comes just weeks after Danaher CEO Rainer Blair explicitly telegraphed the company's appetite for acquisitions during the Q4 2025 earnings call on January 28.
"The M&A environment is more constructive. We've seen some valuations moving in the right direction. Interest rates have moderated a little bit, and our cultivation, and our bias towards M&A and our cultivation of those M&A targets, remain as strong as ever... our balance sheet is primed."
When asked whether Danaher was ready to "get a little more aggressive" and "move on something potentially more sizable," Blair responded that "we like the setup" and the company was prepared to act on opportunities .
Ask Fintool AI AgentStrategic Rationale: Patient Monitoring Meets Life Sciences
Masimo has built a dominant position in hospital pulse oximetry through its proprietary Signal Extraction Technology (SET), which delivers more accurate readings during patient motion and low perfusion conditions. Over 100 independent studies have validated its clinical superiority over competing technologies .
The company's healthcare business focuses on three growth vectors:
- Commercial Excellence - Restructured sales force to leverage pulse oximetry relationships across adjacent monitoring categories including capnography, hemodynamics, and brain monitoring
- Intelligent Monitoring - AI-enabled next-generation sensors capable of detecting cardiac dysfunction like atrial fibrillation using only pulse oximetry data
- Wearable Technologies - Expansion into remote patient monitoring and telehealth solutions
For Danaher, which generates $24.6 billion in annual revenue across life sciences, biotechnology, and diagnostics, Masimo represents a logical expansion into acute care patient monitoring—a market adjacent to its existing clinical diagnostics franchise .
Masimo's Turnaround Sets the Stage
Masimo has spent the past two years unwinding a disastrous 2022 acquisition and refocusing on its core healthcare business—positioning the company as an attractive target.
The company acquired audio products maker Sound United for $1 billion in 2022, a deal that investors savaged, sending shares down 37% and wiping away $5 billion in market value . Activist investor Politan Capital subsequently took a 9% stake and pushed for changes.
In May 2025, Masimo announced the sale of its consumer audio business to HARMAN International (a Samsung subsidiary) for just $350 million—crystallizing a $650 million loss on the Sound United deal .
The divestiture allowed CEO Katie Szyman, who joined in 2024, to refocus on the core healthcare business. In Q2 2025, Masimo's healthcare segment delivered $370 million in revenue with 600 basis points of operating margin expansion .
Ask Fintool AI AgentFinancial Comparison: Acquirer vs. Target
| Metric | Danaher (FY 2025) | Masimo (FY 2024) |
|---|---|---|
| Revenue | $24.6B | $2.1B |
| EBITDA Margin | 29.1%* | 5.1%* |
| Operating Cash Flow | $6.4B | - |
| Total Debt | $18.4B* | $846M |
| Cash | $4.6B | $178M |
*Values retrieved from S&P Global
The margin differential highlights a key opportunity: Danaher's renowned "Danaher Business System" (DBS)—its operational excellence framework—could potentially unlock significant margin expansion at Masimo, similar to past acquisitions where DBS drove hundreds of basis points of improvement.
Danaher's Acquisition Playbook
Danaher has built its $150 billion market cap through disciplined M&A, acquiring and improving businesses over decades. The company typically targets:
- End markets with long-term tailwinds - Healthcare and life sciences fit this criteria
- Defensible competitive positions - Masimo's pulse oximetry technology has 100+ validating clinical studies
- Margin expansion opportunities - Masimo's sub-10% EBITDA margin vs. Danaher's 29%+ suggests significant DBS upside
- Financial models that work - Even at a 43% premium, the strategic value may justify the price
The company's Q4 2025 commentary emphasized that bioprocessing and life sciences end markets are improving, with pharma customers showing consistent recovery . Adding patient monitoring diversifies Danaher's healthcare exposure.
What to Watch
Regulatory Path: A deal of this size will require antitrust review. While Danaher and Masimo have limited direct competitive overlap, regulators may scrutinize the combination in the broader context of healthcare industry consolidation.
Integration Execution: Masimo's technology-driven culture and founder-led history present integration challenges. Former CEO Joe Kiani, who founded the company and led it until 2024, remains influential.
Apple Litigation: Masimo is currently embroiled in patent litigation with Apple, alleging the tech giant stole trade secrets related to blood oxygen monitoring technology. The outcome could impact the value of Masimo's IP portfolio.
Deal Timeline: The FT reported the companies are "closing in" on an agreement, suggesting a formal announcement could come within days to weeks.
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