“We are extremely pleased to add a high quality, differentiated market leader in minimally invasive delivery devices and components to Nordson’s existing medical platform,” said Michael F. Hilton, Nordson president and CEO. “This acquisition aligns with the medical growth strategy we have consistently articulated, brings significant scale to what is already one of Nordson’s fastest growing businesses, and enhances strategically important capabilities including design and development, extrusion, complex medical tubing and balloon manufacturing, nitinol forming and other specialty material expertise. We see Vention AT as an ideal complement to our current offering of single-use fluid management components, biomaterial delivery devices, and high end cannula and tubing, and we are excited to bring our combined capabilities to the many leading medical OEM customers we share.” Vention AT employs approximately 775 people and will operate as part of Nordson’s Advanced Technology Systems segment.
Benefits of the Transaction
- Adds scale in attractive and rapidly growing end markets: Offers leadership position in minimally invasive interventional delivery end markets that are growing at a high single digit rate.
- Enhances strategic manufacturing and product capabilities: Adds design, development, prototyping and regulatory expertise; high end tubing, catheter and balloon manufacturing expertise; material expertise.
- Expands product portfolio: Offers more than 20,000 SKUs to more than 1,500 customers with a significant portion of single use consumables that generate a steady stream of recurring revenue. Highly complementary to Nordson’s current offering of single-use fluid management components, biomaterial delivery devices, and high end cannula and tubing.
- Expands applications and end markets served: Brings expertise in coronary/peripheral vascular, minimally invasive, structural heart, electrophysiology, urology, kyphoplasty and several other high growth therapeutic areas.
- Delivers attractive financial benefits: Expected to accelerate Nordson top and bottom line growth and be accretive to EBITDA margins. Nordson expects $0.05 to $0.10 accretion to EPS in fiscal year 2017, including estimated purchase accounting charges.
- Provides customer synergies: Deepens and expands Nordson’s exposure to large OEM’s and emerging innovators. Selected cross-selling opportunities.
- Provides presence in key medical regions: Footprint in Minneapolis, Ireland and Israel, among others.
- Aligns with articulated acquisition strategy: Follows other successful Nordson acquisitions in the medical space including Value Plastics, Micromedics, LinkTech Quick Couplings and Avalon Catheters.
- Further balances Nordson’s Advanced Technology Systems segment around less cyclical end markets.
Vention Medical is a portfolio company of KRG Capital Partners. Vention Medical consists of the Advanced Technologies (Vention AT) business and a separate Device Manufacturing Services (Vention DMS) business, a contract manufacturing operation not core to Nordson’s strategic direction. Nordson’s acquisition of Vention AT is expected to close during Nordson’s second fiscal quarter, pending customary regulatory clearances.
As is customary in transactions of this nature, certain information regarding Vention AT is subject to restrictions on disclosure until closing. Following the close of the transaction, additional financial information, including audited financial statements, will be provided by Nordson in its filings with the Securities and Exchange Commission.
Morgan Stanley & Co. LLC is serving as financial advisor to Nordson, and Jones Day is serving as a legal advisor.
MedPlast Inc., a global services provider to the medical device industry, has signed a definitive agreement to acquire Vention Medical's Device Manufacturing Services business. The acquisition broadens MedPlast's portfolio of capabilities and bolsters its position as a services provider to the world's largest original equipment manufacturers.
MedPlast's acquisition will further expand the company's capabilities in assembly and packaging, enabling it to offer customers a comprehensive suite of services producing a wide range of medical products. It also will extend MedPlast's global footprint to 22 manufacturing facilities located in key markets throughout North and Central America, Asia and Europe. Once complete, the acquisition will more than double MedPlast's size. The company will employ more than 3,500 engineers, technicians and assembly workers specializing in producing surgical, orthopedic, diagnostic and other medical devices.
"This acquisition will significantly strengthen MedPlast's leadership position in the medical device manufacturing industry," said MedPlast Chief Executive Officer Harold Faig. "We will provide our customers a broad spectrum of integrated manufacturing capabilities and services from strategic locations around the world. This is something our customers have been asking for, and we are committed to continuing to expand our capabilities in areas that will bring value to our customers."
Bill Flaherty, president of Vention Medical's Device Manufacturing Services business, added, "We are excited to come together with MedPlast. We serve many of the same customers who will benefit from our combined offering and shared commitment to providing the highest quality standards and facilities in the industry."
MedPlast's acquisition comes two months after the company partnered with two investment firms to expand its offering. JLL Partners, a middle-market private equity firm, and Water Street Healthcare Partners, a strategic investor focused exclusively on the health care industry, invested in MedPlast in December 2016.
"This is the first of what we expect will be more strategic acquisitions to build MedPlast into a market leader. Water Street and JLL are working closely with management to identify and pursue opportunities that will achieve MedPlast's goal of offering customers a comprehensive, integrated portfolio of end-to-end product solutions," said Kevin Swan, partner, Water Street.
The transaction is expected to close in the second quarter of 2017. Financial terms of the agreement are not being disclosed.