There are two deals which caught my eye this month as examples of companies reassuring shareholders that their key focus on their core businesses is paramount and diversification is not always key to maintaining share price:
Patterson Companies sold its medical therapy division for €645m to Madison Dearborn Partners (MDP), a Chicago-based private equity firm. Patterson’s strategy was to sell this division to finance its recent expansion into the farm animal equipment sector. In May, it closed its €986m purchase of Dallas-based Animal Health International – a move that doubled the size of its veterinary supply business. The sale of the therapy and rehabilitation equipment division helped the company narrow its focus to dental and animal health. As a result of stripping the medical division and adding Animal Health, Patterson has become a product distribution behemoth with c. €5.3 billion in annual revenue.
Endo Pharmaceuticals, which acquired American Medical Systems (AMS) back in 2011, divested its men’s health and prostate businesses to Boston Scientific Corp for €1.48bn. Endo is also currently evaluating strategic options for the AMS Women’s Health business. Over the last couple of years, Endo has been adding to its drug portfolio through acquisitions that have been key for the expansion of its generic-drug segment – notably acquiring Boca Pharmacal and DAVA Pharmaceuticals in 2014, and acquiring Par Pharmaceuticals and Apsen Pharmacare via its Litha Pharma division this year.
Clearwater International has experience in divestments, having previously advised NASDAQ-listed Prism Medical on the sale of its UK subsidiary, Prism Medical UK, to UK private equity firm LDC, and advised on the divestment of DCC plc non-core assets Days Healthcare, Physio Med Services and Ausmedic Australia to Patterson Companies Inc.
Health and social care
UK residential care home company Rosewood Healthcare Group acquired Care at Home (Wales), for an undisclosed amount. Care at Home (Wales) comprised three care homes in Rhos-on-Sea, Wales.
NYSE-listed Universal Health Services (UHS) backed the €135m acquisition of UK based Alpha Hospitals by its UK subsidiary Cygnet Health Care. Alpha Hospitals operates mental health care facilities that provide psychiatric care services for people with mental health conditions and learning difficulties.
AMAG Pharmaceuticals Inc., US listed speciality pharmaceutical company that focuses on maternal health, anaemia, and cancer supportive care, completed their previously announced acquisition of CBR Systems Inc., for a consideration of€626m. Based in the US, CBR Systems operates a cord blood stem cell bank that serves families in the United States and internationally.
Fullerton Healthcare Group Pte Ltd, Singapore based provider of corporate healthcare solutions in the Asia-Pacific region, acquired Hong Kong based HMMP Limited, a medical group that manages a network of medical clinics, dental clinics, physiotherapy centres, Chinese herbalist clinics, and laboratory centres, for an undisclosed amount.
US based American Addiction Centers, Inc., provider of substance abuse treatment services for individuals with drug and alcohol addiction, acquired The Oxford Centre, Inc., for a consideration of €31m. The Oxford Centre is a US based drug and alcohol addiction treatment centre focused on opiate dependency.
CooperSurgical, Inc., US based supplier of diagnostic products, surgical instruments and accessories to the gynaecology market and subsidiary of The Cooper Companies, Inc., acquired Reprogenetics LLC, for a consideration of €42m. Reprogenetics is a US based company providing genetic screening and genetic diagnosis services.
ABRY Partners, LLC and The Riverside Company, the US based private equity firms, acquired North American Dental Group, LLC (NADG), the US based dental service organisation, for an undisclosed amount.
Nasdaq-listed The Ensign Group Inc., provider of skilled nursing and rehabilitative care services, acquired:
- Citrus Hills Assisted Living and Whittier Glen Assisted Living, US based skilled nursing care facilities, for an undisclosed amount;
- Harmony Living Centers, LLC, assisted living and senior care services provider, for an undisclosed amount; and
- 15 other assisted living operations based in Wisconsin, US, for an undisclosed amount.
Pharma & Biotech
NYSE-listed pharmaceutical company Perrigo completed the acquisition of GlaxoSmithKline’s portfolio of well-established over the counter brands, for a consideration of €203m. The European brands acquired in the areas of nicotine replacement therapy, cold and flu, and cold sore treatment included GlaxoSmithKlines NiQuitin and Nicotinell brands.
Nasdaq listed biopharmaceutical company, Celgene Corporation, completed the acquisition of Receptos Inc., US based clinical-stage biopharmaceutical company, focused on the discovery, development, and commercialisation of therapeutics in immune disorders, for a consideration of €6.1bn.
CVS Pharmacy, Inc., operator of a chain of pharmacies and drug stores in the US, and a subsidiary of CVS Health Corporation, acquired Omnicare Inc., a US based pharmaceuticals wholesaler, for a consideration of €10.2bn.
UK scientific laboratory and consultancy business Concept Life Sciences, subsidiary of UK private equity firm Equistone Partners Europe Ltd, acquired CXR Biosciences Ltd, a Spain based drug discovery and development services provider, for an undisclosed amount.
Australian sandalwood provider TFS Corporation Ltd completed the acquisitions of:
- Santalis Pharmaceuticals Inc., a US-based botanical pharmaceuticals manufacturer, for a consideration of €83m; and
- Viroxis Corporation, a bio-pharmaceutical company, focused on developing and commercialising prescription and OTC botanical products for the treatment of virally-induced skin conditions, for a consideration of €152m.
Listed South Africa-based Ascendis Health Limited, provider of health and beauty products, acquired a 49% stake in Farmalider, S.A., a Spain-based pharmaceutical company engaged in the development, registration, licensing and production of generic pharmaceutical products, for a consideration of €15m.
Unison Capital, Inc., a Japan-based private equity firm, acquired the Anti-Rheumatic Pharmaceuticals Business of Santen Pharmaceutical Co., Ltd, a Japan-based pharmaceutical manufacturing company, for a consideration of €334m. The business acquired manufactures and distributes anti-rheumatic pharmaceuticals for the treatment of rheumatoid arthritis.
Medical Equipment & Supplies
NYSE-listed medical device company Medtronic acquired Medina Medical Inc., US-based company that provides minimally-invasive devices for the treatment of brain aneurysms and stroke, for a consideration of €134m.
Patterson Companies Inc. completed the sale of Patterson Medical Products Inc., US-based rehabilitation supply products wholesaler, to US based private equity firm Madison Dearborn Partners, LLC, for a consideration of €645m.
Edwards Lifesciences Corp., US based company that provides products and technologies to treat structural heart disease, acquired CardiAQ Valve Technologies, Inc., for a consideration of €359m. CardiAQ Valve Technologies is a US medical device company developing technologies for percutaneous mitral heart valve replacement.
Prism Medical UK, manufacturer of moving, handling and bathing solutions for people with a disability and portfolio company of UK private equity firm LDC, acquired Smirthwaite Ltd, a UK-based manufacturer of specialised equipment for children and young people with special needs, for an undisclosed amount.
Listed Ireland-based pharmaceutical company Allergan plc, completed their previously announced acquisition of Oculeve, Inc., the US based company engaged in the development of devices for dry eye disease treatment, for a consideration of €113m.
NYSE-listed medical device company Boston Scientific Corporation, acquired the Men’s Health and Prostate Health Businesses of American Medical Systems Holdings Inc., for a consideration of €1.48bn. The acquired business encompasses the AMS product portfolio for treating urologic conditions, including benign prostatic hyperplasia (BPH), male stress urinary incontinence and erectile dysfunction, and will become part of Boston Scientific Urology and Women’s Health.
Observe Medical Nordic AB, Swedish developer of digital monitoring equipment for kidneys, was acquired by Norway based public pharmaceutical company, Navamedic ASA, for a consideration of €18m.