Dive Brief:
- Getinge has paid $320 million to acquire Healthmark Industries for its U.S. sterile reprocessing capabilities.
- Healthmark makes instrument care and infection control consumables for cleaning verification and packaging in the sterile processing departments of hospitals. The company, which employs 400 people, expects to report net sales of $126 million in the year ending Oct. 31.
- Buying Healthmark strengthens the position of Getinge, a Swedish company, in the U.S. and continues a flurry of M&A activity that includes the takeovers of Ultra Clean Systems and High Purity New England.
Dive Insight:
Quality and supply problems at its cardiac assist and cardiopulmonary units have held Getinge back this year. The problems have triggered multiple Class I recalls and the temporary suspension of two CE marks, resulting in a 400 million Swedish kronor ($37 million) earnings hit. Against that backdrop, Getinge has looked to M&A to drive growth in other parts of its business.
The latest deal sees Getinge acquire Healthmark for $320 million. Healthmark provides products used in the cleaning of surgical instruments and the verification and validation of the cleaning process, as well as packaging for the sterilization, storage and delivery of the instruments. The company works out of sites in Michigan and France.
Getinge already has a presence in the sterile reprocessing sector, providing products for cleaning and disinfection, but expects minimal overlap with Healthmark’s portfolio. As well as regarding the portfolios as complementary, Getinge views differences in the companies’ areas of geographic strength as a positive.
“The acquisition strengthens Getinge’s position in the infection prevention sector in the U.S., and our global customer reach in Europe and Asia will also accelerate Healthmark’s international development,” Stéphane Le Roy, president of surgical workflows at Getinge, said in a statement. Around 90% of Healthmark’s sales currently originate in the U.S.
Those sales will make a “material contribution” to revenues at Getinge’s surgical workflows business. The company expects to realize net synergies of around $30 million over the next five years as a result of the takeover.