LONDON, UK: Smiths Group plc has entered into an agreement for the sale of Smiths Medical to Trulli Bidco Limited, a wholly owned subsidiary of funds advised by TA Associates LLP.
The proposed transaction values Smiths Medical at an enterprise value of $2.3 billion (equivalent to £1.7 billion), plus an additional $0.2 billion contingent on future performance of Smiths Medical.
The Smiths board proposes a significant return of capital to shareholders following the successful completion of the proposed transaction.
Paul Keel, CEO, Smiths Group plc, said: “This transaction positions Smiths as a more focused industrial technology company with compelling opportunities for growth, a common operating model and shared purpose.
Delivering on our commitment to separate, the sale captures immediate value for Smiths’ shareholders and positions us well for further value creation through our retained 30% ownership in Smiths Medical as well as potentially $0.2bn additional consideration, contingent on future performance.
Smiths Medical is a leader across its markets, with strong brands and technology, although it has not delivered consistently strong financial performance relative to its medtech peers. We look forward to working with TA as a strategic partner in unlocking the potential for this business. I would like to thank everyone at Smiths Medical for their tremendous contributions to the Group and look forward to our continued collaboration.”
Birker Bahnsen, Managing Director, TA Associates LLP, said: “Smiths Medical has an excellent product portfolio with leading positions in its key franchises of infusion systems, vascular access and vital care. Its well-established brands are trusted globally, and we are excited to be working with the management team to build on this strong platform for growth. We see many opportunities for expansion and will invest in technology to build the company’s capabilities and reinforce its leading product portfolio.
We believe that TA is well-positioned as a growth investor to support Smiths Medical in driving innovation and value going forward. Our deep medical device experience, operational knowledge and strong track record of partnering with management teams to accelerate growth, give us confidence that we can help Smiths Medical grow both organically and through acquisitions.”
JehanZeb Noor, CEO, Smiths Medical, said: “Our new ownership structure presents a great opportunity for Smiths Medical, our employees and our customers. We are looking forward to working with TA who have been an active investor in the healthcare industry for more than 30 years and who can help us accelerate our growth, create value for our customers and, most importantly, improve the lives of millions of patients globally.”
Smiths is a global technology company listed on the London Stock Exchange (SMIN) and operates a sponsored level one ADR programme (SMGZY). Its businesses share the same characteristics (technology differentiation; increasing digitisation; sustainably competitive; and a high proportion of recurring revenues generated by aftermarket and services) and a common operating model (The Smiths Excellence System).
Smiths Group plc share price
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2 Aug, 5:11 pm GMT+1 ·Disclaimer