Henry Schein
(Nasdaq: HSIC)
announced today that private equity firm KKR is investing $250 million in the medical products manufacturer and distributor.
On the stock market, news of the investment — along with an increase of $500 million to the company’s stock repurchase program — appeared to offset a preliminary Q4 revenue figure of $3.2 billion. The revenue was below the Wall Street analyst consensus of $3.34 billion. The company also only expects revenue to grow in a range of low to mid-single digits in 2025 as compared to 2024
HCIC shares were up more than 4% this morning to $$80.71 apiece.
KKR’s 12% stake makes it the largest non-index fund shareholder in the company, and KKR can purchase additional shares on the open market to bring its total equity stake to 14.9%.
KKR gets seats on the company’s board. Max Lin, a KKR advisor who leads the firm’s Health Care industry team, and William K. “Dan” Daniel, an executive advisor to KKR and former EVP at Danaher Corp., will join as independent directors. Henry Schein also announced a third independent board director appointment: Robert J. “Bob” Hombach, who was previously CFO and COO of Baxalta. Before that, he was CFO of Baxter.
The appointments temporarily boost Henry Schein’s number of board members to 16, but the company plans to reduce the number to 14 following its 2025 annual meeting.
The deal still awaits customary closing conditions, a U.S. antitrust waiting period, and foreign regulatory approvals.
Talk of strategic growth around KKR’s investment in Henry Schein
Henry Schein and KKR officials said in a news release that the new collaboration will focus on strategic growth, operational excellence, capital allocation, and employee engagement, including exploring broad-based equity ownership.
“Our board and management have great respect for KKR, including its partnership-oriented approach and experience in supporting value creation across its investments. This is a testament to the hard work of Team Schein to advance our leadership as a solutions-driven innovator for healthcare professionals,” said Henry Schein CEO Stanley M. Bergman.
Lin said that KKR sees tremendous growth potential in the company: “We look forward to working with the management team on strategic and operational initiatives to drive value for all of Henry Schein’s stakeholders.”
