Niki Arrowsmith08.28.12
Halmstad, Sweden-based Getinge Group has signed a definitive agreement to purchase the therapeutic support systems (TSS) business of San Antonio, Texas-based medical technology company Kinetic Concepts Inc. (KCI). KCI also has a negative pressure therapy platform business that is not being sold.
The acquisition is valued at $275 million. Getinge will purchase all assets and intellectual property associated with the TSS business. Transaction and restructuring costs will amount to $35 million, of which $25 million will be charged to Getinge’s profit in the fourth quarter of 2012. The remaining $10 million will be charged in fiscal year 2013. The acquisition is pending approval of the antitrust authorities in several countries, but Getinge expects the transaction to be completed in the fourth quarter of 2012.
Getinge has a broad presence in many European markets, while KCI’s primary geographical area of strength is the North American market. The combination of Getinge’s and KCI’s TSS business is hoped to create a global platform with strong positions in most key markets, with significant potential for portfolio and operational synergies. The TSS portfolio and operations will be integrated into Getinge Extended Care under the ArjoHuntleigh brand.
The TSS business includes a portfolio of specialty therapeutic beds, mattress replacement systems and other support surfaces and patient mobility devices. KCI’s TSS also has a particularly strong portfolio for therapeutic wound care, bariatric care and critical care settings. The TSS business had revenues of $247 million in 2011, with approximately 1,300 employees globally with sales locations in the United States, Canada, Germany, Austria, Italy Switzerland, the United Kingdom and France. In 2011, the U.S. market accounted for 60 percent of the TSS business, with Europe accounting for approximately 30 percent. Similar to Getinge Extended Care’s Therapeutic Surfaces business, rental is the primary business model applied for serving customers in acute and post-acute care. The acquisition will enable Getinge Extended Care to achieve a balance between equipment sales and recurring revenues, and the business in the United States will increase significantly, in line with its strategic goals, according to the company’s leadership.
“The acquisition of TSS provides an optimal extension of Getinge’s Extended Care business, boosting the competencies of our operations,” said Johan Malmquist, CEO of Getinge Group. “It has the potential to offer substantial value, innovation and choice to our customers around the world.”
Getinge Group has three brands under its umbrella: ArjoHuntleigh, Getinge and Maquet. ArjoHuntleigh focuses on patient mobility and wound management solutions. Getinge provides solutions for infection control within healthcare and contamination prevention within life sciences. Maquet specializes in solutions, therapies and products for surgical interventions, interventional cardiology and intensive care.
Late last year, KCI was purchased in a leveraged buyout by private-equity firm Apax Partners for $6.3 billion.
The acquisition is valued at $275 million. Getinge will purchase all assets and intellectual property associated with the TSS business. Transaction and restructuring costs will amount to $35 million, of which $25 million will be charged to Getinge’s profit in the fourth quarter of 2012. The remaining $10 million will be charged in fiscal year 2013. The acquisition is pending approval of the antitrust authorities in several countries, but Getinge expects the transaction to be completed in the fourth quarter of 2012.
Getinge has a broad presence in many European markets, while KCI’s primary geographical area of strength is the North American market. The combination of Getinge’s and KCI’s TSS business is hoped to create a global platform with strong positions in most key markets, with significant potential for portfolio and operational synergies. The TSS portfolio and operations will be integrated into Getinge Extended Care under the ArjoHuntleigh brand.
The TSS business includes a portfolio of specialty therapeutic beds, mattress replacement systems and other support surfaces and patient mobility devices. KCI’s TSS also has a particularly strong portfolio for therapeutic wound care, bariatric care and critical care settings. The TSS business had revenues of $247 million in 2011, with approximately 1,300 employees globally with sales locations in the United States, Canada, Germany, Austria, Italy Switzerland, the United Kingdom and France. In 2011, the U.S. market accounted for 60 percent of the TSS business, with Europe accounting for approximately 30 percent. Similar to Getinge Extended Care’s Therapeutic Surfaces business, rental is the primary business model applied for serving customers in acute and post-acute care. The acquisition will enable Getinge Extended Care to achieve a balance between equipment sales and recurring revenues, and the business in the United States will increase significantly, in line with its strategic goals, according to the company’s leadership.
“The acquisition of TSS provides an optimal extension of Getinge’s Extended Care business, boosting the competencies of our operations,” said Johan Malmquist, CEO of Getinge Group. “It has the potential to offer substantial value, innovation and choice to our customers around the world.”
Getinge Group has three brands under its umbrella: ArjoHuntleigh, Getinge and Maquet. ArjoHuntleigh focuses on patient mobility and wound management solutions. Getinge provides solutions for infection control within healthcare and contamination prevention within life sciences. Maquet specializes in solutions, therapies and products for surgical interventions, interventional cardiology and intensive care.
Late last year, KCI was purchased in a leveraged buyout by private-equity firm Apax Partners for $6.3 billion.