Shares of Kinetic Concepts Inc. (NYSE:KCI) are popping on Wall Street after media reports that the company may be in play for a leveraged buyout.
Bloomberg News Service first reported the rumor this morning, saying that the San Antonio, TX.-based wound management company was in talks with two private equity firms for a deal that could be worth $5 billion. The wire service cited “people with knowledge of the matter.”
Since the news hit The Street, shares of KCI have jumped dramatically, jumping some 13 percent from yesterday’s closing price of $58.78 per share. Trading volume has also increased by several orders of magnitude to 7.5 million shares, compared to yesterday’s relatively sleepy 837,000 shares.
KCI, which was founded in 1976, makes products for wound care, bariatric and critical care markets. It pulled in just over $256 million in profit on $2.02 billion in sales in 2010.
The company has had its share of legal battles with Smith & Nephew Group plc (NYSE:SNN) in their long-running war over negative-pressure wound therapy. The donnybrook between the companies has played out in courts in Europe and the U.S., with each notching victories and setbacks.
