Kalamazoo, Michigan-based medical-device maker, Stryker announced that the company had reached an agreement to acquire Sage in a $2.76 billion agreement. The company confirmed the news through its official statement released on the company's website.

Sage, a 45-year-old intensive care product manufacturer is previously under the acquisition of a private equity firm Madison Dearborn Partners according to USA Today. Sage business which is aligned with Stryker's is seen as the main reason for the acquisition as the company could make use of Sage main client which is hospitals around the United States to better market their products too.

The acquisition which is expected to be completed by the end of second quarter this year will see Stryker obtaining a tax benefit of around $500 million as calculated by The Wall Street Journal. Besides increasing the company's potential cash flow for the next 15 years, Stryker is also optimistic about its earnings as the company had also adjusted its 2016 earnings to $5.75 per share.

Stryker's CEO, Kevin Lobo also said that the acquisition will help the company to obtain a consistent disposable revenue considering the fact that Sage reported total sales of $430 million in 2015 alone. The acquisition is also part of Stryker latest international expansion plan as the company has been actively involved in more countries outside the United States.

According to CNBC, Lobo was also quoted to be saying that more deals will be done by the company soon. He said that "One of the reasons to postpone the share repurchase program was to make sure we still have the capacity, so this will not be the last deal that we do."

Sage is the manufacturer for disposable intensive-care products has been responsible for providing hospitals with different products that help to clean the patient from skin to oral cleaning. The disposable products has been helping hospitals to control disease from infecting and is expected to see more growth in the coming years as more infectious disease is spreading.

Stryker, on the other hand, is the major player for patient-handling equipment, surgical devices, and also hip and joint replacement related products.

With its fourth-quarter earnings report saw the company's profit doubled compared to previous quarter. For the acquisition, J.P. Morgan Securities act as its financial adviser and Sullivan & Cromwell as the legal counsel.

Sage President and CEO, Scott Brown said in a statement that the acquisition is good for the company because Stryker "Understands our business, supports our goals and embraces our values." There is still no announcement regarding Brown's position once the acquisition is complete.