Teleflex (NYSE:TFX) announced today that it agreed to sell a significant portion of its respiratory business to Medline Industries for $286 million.
Total consideration for the sale amounts to $286 million, reduced by $12 million of working capital to be retained by Teleflex, according to a news release. Assets set to be divested generated revenues of $139 million in 2020, while Teleflex expects 2021 headwinds for revenues between $28 million and $32 million and adjusted EPS between 10¢ per share and 15¢ per share. The company maintains its current 2021 adjusted EPS guidance range, having announced restructuring plans in last month’s first-quarter earnings report.
Wayne, Pa.–based Teleflex’s respiratory product lines being divested to Medline include its oxygen and aerosol therapy, active humidification, non-invasive ventilation and incentive spirometers. The companies expect the acquisition to close in the third quarter of 2021.
Teleflex plans to use proceeds collected from the sale to pay down debt in an effort to aid its financial flexibility and support its growth strategy.
“Following a comprehensive review of our strategy and core capabilities, our board of directors and management team decided that divesting a significant portion of our Respiratory business will enable Teleflex to focus further on executing in our core market segments to drive long-term sustainable growth and increase shareholder value,” Teleflex CEO Liam Kelly said in a news release.