Tuesday, April 12, 2016
Halyard Health, Inc. (HYH) announced its agreement to acquire privately held CORPAK MedSystems (Corpak), headquartered in Buffalo Grove, Illinois. The acquisition is an all-cash transaction for a total consideration of $174 million, funded with a combination of current cash and Halyard's revolving credit facility and is expected to close in the second quarter. Corpak, a portfolio company of Linden Capital Partners, develops, manufactures and markets a broad portfolio of high-quality, branded enteral access devices.
Corpak has a long history of innovating enteral access solutions to improve patient outcomes, safety and comfort. The company's leading portfolio of nasogastric tubes complements Halyard's existing enteral feeding products and creates a complete offering of enteral feeding solutions for patients and caregivers. Corpak's sales for fiscal year 2015 totaled approximately $54 million.
"We are excited to integrate Corpak's innovative products into our market-leading enteral feeding portfolio enabling us to serve our doctors and their patients more broadly," stated Robert Abernathy, Halyard Chairman and Chief Executive Officer. "Corpak's business aligns well with our existing Medical Devices segment with slightly higher sales growth and similar gross margins. This first acquisition is an important step in achieving our strategic vision of transforming Halyard into a leading medical devices company, and positioning our business for future growth."
The transaction is expected to be $0.05 accretive to Halyard's fiscal year 2016 adjusted dilutive net earnings per share excluding acquisition, integration-related and intangible amortization charges. As such, the company is updating its previously announced full year 2016 adjusted diluted EPS guidance to $1.50 to $1.70. In 2017 the transaction is expected to be approximately $0.15 accretive.
"Corpak achieved above-market growth through our focus on innovation, team and culture, and strategic realignment to become the 'Preferred Enteral Partner,'" said Frank McCaney, Chief Executive Officer of Corpak. "We believe that Corpak is well positioned for continued achievement and long-term success with Halyard, a company that understands our business, supports our goals and embraces our values."
"Linden is proud to see Corpak find a great home with Halyard," said Brian Miller, a Linden Managing Partner. "During our seven-year ownership, Linden pursued its value creation plan that included an expanded strategy, an enhanced leadership team, a non-core divestiture, multiple joint ventures and acquisitions, new headquarters, direct international expansion, and intensive research and development for new product launches."
Transaction closing is subject to approval under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions.
Robert W. Baird & Co. served as Halyard's exclusive financial advisor and Alston & Bird LLP served as outside legal counsel for Halyard in connection with this transaction.
Houlihan Lokey, Inc. served as Corpak's financial advisor and Kirkland & Ellis LLP served as legal counsel in connection with this transaction.
Source : beta.finance.yahoo.com
