Acelity said today that it inked a definitive agreement with Allergan (NYSE:AGN) to sell its LifeCell business for $2.9 billion in cash.
The deal will put LifeCell’s regenerative medicine and reconstructive portfolio under Allergan’s roof, joining its medical aesthetics, breast implant and tissue expander product lines. Dublin-based Allergan said it expects will generate approximately $450 million in revenue this year, growing at a mid-single digit rate.
“The acquisition of LifeCell is both strategically and financially compelling to Allergan and serves as our entry point into regenerative medicine as we create a world-class aesthetic and regenerative medicine business in plastic surgery. LifeCell’s regenerative medicine unit is a strong fit with our existing business and can be significantly strengthened with our infrastructure and global reach. This acquisition is an immediately accretive investment that enhances our near-term and long-term growth profile with products that enjoy strong sales and are the leading choices for surgeons who rely on them for successful surgical procedures,” Allergan Chair & CEO Brent Saunders said in prepared remarks.
LifeCell’s portfolio includes its Acellular dermal matrices used for breast reconstruction and complex hernia surgeries, Alloderm human allograft tissue matrix designed for soft tissue repair or replacement, the Revolve single use high-volume fat grafting device and the Strattice and Artia porcine tissue matrices.
In addition with the products, Allergan will also pick up LifeCell’s New Jersey-based manufacturing and R&D operations.
“The LifeCell brand leads the industry for safety, efficacy and superior clinical results, and we are pleased to have found the perfect partner for LifeCell in Allergan. This transaction not only sets LifeCell up for continued success, but it also allows Acelity the ability to continue our own transformation with increased momentum and investments that focus on developing and commercializing advanced wound therapies and dressings in markets around the world,” Acelity prez & CEO Joe Woody said in a press release.
The companies said they expect the acquisition to close during the 1st half of 2017. Until it is finalized, Acelity will continue to manage the LifeCell business.
Earlier this month, Acelity spiked an initial public offering that could have fetched as much as $1 billion.
Acelity, formerly Kinetic Concepts Inc., was acquired for $6.1 billion by Apax Partners and a pair of Canadian pension funds in a leveraged buyout in November 2011. The company, which makes wound care products, later folded KCI sister company LifeCell and acquisition Systagenix into the Acelity brand.
Last August the company registered for the IPO, confirming rumors that 1st surfaced in June 2015 that its private equity owners are looking look to pay down debt. In early December Acelity, which had planned to list on the New York Stock Exchange, asked the SEC to withdraw its registration.
In October 2013, then-KCI paid $485 million to acquire Systagenix, the wound care business spun out of Johnson & Johnson (NYSE:JNJ) in 2008. The company united Systagenix, LifeCell and KCI under the Acelity brand in September 2013.
