3M to buy medical technology group Acelity in $6.7bn deal
3M has agreed to buy privately-held medical technology company Acelity in a $6.7bn deal, including debt.
It is buying Acelity from a consortium of funds advised by Apax Partners, affiliates of Canada Pension Plan Investment Board and the Public Sector Pension Investment Board.
Acelity is focused on advanced wound care and specialty surgical applications marketed under the KCI brand. The business generated revenues of $1.5bn in 2018.
3M's chief executive, Mike Roman, said: "Acelity is a recognised leading provider of advanced wound care technologies and solutions and an excellent complement to our health care business. This acquisition bolsters our medical solutions business and supports our growth strategy to offer comprehensive advanced and surgical wound care solutions to improve outcomes and enhance the patient and provider experience.
"We are excited to bring Acelity’s technologies and dedicated employees to our team. Together, we will apply 3M science to bring differentiated offerings to key wound and operative care solutions worldwide."
On a GAAP reported basis, the deal is expected to be $0.35 dilutive to earnings per share in the first year after completion, including financing costs. Excluding purchase accounting adjustments and anticipated one-time expenses related to the transaction and integration, 3M reckons the acquisition should be $0.25 accretive to EPS over the same period.
The deal, which will be financed through a combination of available cash and the issuance of new debt, is expected to close in the second half of this year.
At 1250 BST, 3M shares were down 1% in pre-market trade at $184.20.