CareFusion Corp. today announced the signing of a definitive agreement for CareFusion to acquire the Vital Signs division of GE Healthcare for $500 million. With annual revenue of approximately $250 million, Vital Signs is a leading manufacturer of single-patient-use consumables for respiratory care and anesthesiology. The company also markets products for temperature management and patient monitoring consumables.
The acquisition will significantly expand CareFusions Specialty Disposables business by adding global scale and new products for anesthesiology, establishing the company as a leader in the more than $3 billion market for respiratory and anesthesia consumables.
The acquisition of Vital Signs is well-aligned to our long-term growth strategy, helping us create scale in our Procedural Solutions call points and increase our presence outside of the United States, says Kieran T. Gallahue, chairman and CEO of CareFusion. Together, CareFusion and Vital Signs have the R&D, manufacturing and go-to-market resources to drive innovation, invest for growth and better support customers in major geographic markets.
With complementary product lines and geographies, the acquisition will enable CareFusion to:
- Better serve customers globally: With approximately one-third of its revenue coming from customers outside the U.S., Vital Signs will advance CareFusions goal to expand in international markets. The combined sales force will have deep customer and clinical expertise in major global markets.
- Accelerate the transformation of the Specialty Disposables business from a distributor to a vertically integrated manufacturer: With the addition of the Vital Signs portfolio, CareFusion will become a full-line provider of more than 20,000 single-use consumables for respiratory care and anesthesiology, including circuits for oxygen and anesthesia, humidification, masks, filters, pressure infusers and temperature management products.
- Create clear synergy opportunities: Synergies from the transaction are expected to reach $10 million to $15 million per year on a pretax basis by fiscal 2017. CareFusion sees opportunities to improve top- and bottom-line results by increasing international product sales through Vital Signs complementary infrastructure outside of the U.S. and by leveraging CareFusions operational infrastructure.
"We are confident this transaction will provide Vital Signs new capabilities to maximize its opportunities in the medical consumables space and enable GE Healthcare's Life Care Solutions segment to remain focused on its core strengths as a provider of medical device solutions, says Tom Gentile, president and chief executive officer of GE Healthcare's Healthcare Systems division. We believe CareFusion is equipped to unlock the growth potential of Vital Signs with a solid focus and strategy around medical consumables.
The acquisition is expected to be neutral to modestly accretive to CareFusion adjusted diluted earnings per share in fiscal 2014 and $0.05 to $0.08 accretive in fiscal 2015 excluding amortization of acquired intangible assets, non-cash inventory valuation step-up charges, and nonrecurring restructuring, integration and tax charges. The company expects continued earnings accretion in fiscal 2016 and longer term.
CareFusion expects to complete the acquisition for the Vital Signs business in the United States, China and certain other countries by Dec. 31, 2013, and to finalize the remainder of the transaction during its third quarter, ending March 31, 2014, subject to regulatory review and customary closing conditions.
Upon completion of the transaction, Vital Signs will be CareFusions eighth acquisition since 2010.
Headquartered in Totowa, N.J., Vital Signs has more than 1,000 employees in three primary locations worldwide, including manufacturing operations in Shenzhen, China, and a global, field-based sales organization.
Source: CareFusion Corporation
Weekly Rounds: Four Years of COVID-19, AORN 2024 Conference Coverage, and More
March 18th 2024Here are 5 highlights from Infection Control Today®'s (ICT®’s) wide-ranging coverage of the infection prevention and control world. Everything from interviews with known opinion leaders to the news that infection preventionists and other health care professionals can use on their jobs.
Four Years After COVID-19: What Has the Infection Prevention Community Learned?
March 15th 2024Four years ago today, March 15, 2020, the COVID-19 lockdown began, and since then, the world has undergone significant changes. It has been a terrifying experience for everyone, especially for the infection prevention community, both within and outside of the health care sector. However, a crucial question remains unanswered: What has the infection prevention community learned from this pandemic, and where does it go from here?
Could Empathy Help Overcome Vaccine Hesitancy?
March 14th 2024Research findings reveal that correcting misinformation about vaccination can remarkably transform individuals' attitudes toward it. This highlights the crucial role of accurate information in making informed decisions about vaccination.
Empowering Safety: A Massachusetts General Hospital Team Is Pushing for Smoke-Free ORs
March 13th 2024At the AORN’s International Surgical Conference & Expo 2024, a team from Massachusetts General Hospital (MGH) showcased their transformative project, "Becoming Smoke-Free in the OR." This initiative underscored the critical need for smoke evacuation in surgical settings.
Hand Hygiene Practices in the Operating Room: A Collaborative Endeavor
March 13th 2024As explained on a poster at AORN 2024, perioperative nurses and infection preventionists unite in a proactive campaign to elevate hand hygiene within the operating room, resulting in improved adherence, decreased infections, and fortified patient outcomes.