Fresenius Medical Care AG & Co. KGAA agreed to acquire Massachusetts-based medical technology company NxStage Medical Inc. in a transaction valued at about $2 billion.

The deal will strengthen Fresenius Medical Care's position in the home dialysis market and support its 2020 strategic initiative of driving growth in its core business, the German healthcare services company said in a news release.

Fresenius Medical Care will buy all outstanding shares of NxStage through a merger for $30 per common share, using cash and debt to finance the transaction. The company expects initial net cost synergies potential of about $80 million to $100 million per year before tax over three to five years, and anticipates integration cost of around $150 million in the first three years. Fresenius expects the acquisition to be accretive to net income and EPS within three years from closing.

NxStage, which develops medical devices for home dialysis, delivered $366 million in revenue in 2016. NxStage was founded in 1998 and has a workforce of about 3,400 employees.

The merger has been approved by NxStage's board and is subject to approval by its shareholders, plus regulatory approvals and customary closing conditions. The deal is expected to close in 2018.

Bank of America Merrill Lynch and Piper Jaffray are serving as exclusive financial advisers to Fresenius Medical Care and NxStage Medical, respectively.