Medical technology firm Becton, Dickinson and Company (BD) has agreed to sell 50.1% stake in its respiratory solutions business to funds advised by Apax Partners.
BD and Apex will also establish a joint venture that will operate as a new, independent company.
The new company will take BD’s ventilation, respiratory diagnostics, vital signs and AirLife businesses on board.
The deal values the respiratory business at about $500m.
Apax Partners partner Steven Dyson said: "We have been proactively targeting the industry for respiratory devices and have been impressed with the continued progress the company has made over the past few years."
BD’s respiratory solutions plants will be transferred to the new company, which will have an estimated annual revenues of about $900m and over 5,000 employees.
Subject to market conditions, the deal is expected to complete in late fiscal year 2016 or early fiscal year 2017.
BD medical segment president Tom Polen said: "We believe in Apax Partners’ track record of success creating value and improving margins, and as part of the joint venture, we will continue to have a strong interest in the growth and success of the business."
BD intends to use net proceeds for share repurchases. In fiscal year 2017, the company expects earnings dilution of about $0.10 to $0.14 because of the limited profitability of the current business.
Image: BD to divest 50.1% stake in its Respiratory Solutions business. Photo: courtesy of stockimages / FreeDigitalPhotos.net.