Becton Dickinson (BDX), Apax Partners Close Global Respiratory Business Joint Venture

October 4, 2016 7:11 AM EDT

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BD (Becton, Dickinson and Company) (NYSE: BDX) and Apax Partners, announced the launch of a joint venture – Vyaire Medical – a standalone, global respiratory solutions company. The closing finalizes the sale of 50.1 percent interest in BD's Respiratory Solutions business to funds advised by Apax Partners, a leading global private equity firm. Vyaire Medical includes all business lines within BD's Respiratory Solutions business, including Ventilation, Respiratory Diagnostics, Vital Signs and AirLife, and will have estimated annual revenue of over $800 million. BD will retain a 49.9 percent minority interest in the new company.

"We are very pleased with the progress the teams have made in the last six months in preparing Vyaire Medical for success as a standalone company, including the appointment of Dave Mowry as CEO. Dave has more than 25 years of leadership experience within the medical device industry with a strong track record of delivering growth and earnings results. He knows how to successfully lead the implementation of transformational organizational changes and will be backed by an excellent management team. We continue to be highly supportive of an investment program to further develop Vyaire Medical's position as a leading global player in the respiratory market, both organically and through acquisitions," said Steven Dyson, partner at Apax Partners.

"We are delighted to launch this new brand, Vyaire Medical, built on the foundation of excellent products, talented people, and the industry standard for service and support for our customers," said Dave Mowry, CEO, Vyaire Medical. "Our new company will be focused on providing improved patient outcomes and increased value to our customers through a collaborative partnership that brings innovation to these market segments."

BD's Respiratory Solutions facilities will transfer to the new company, including locations in Yorba Linda, Calif.; Palm Springs, Calif.; Plymouth, Minn.; Mexicali, Mexico; Cotia, Brazil; Hoechberg, Germany and Shenzhen, China. The new company will employ more than 5,000 associates around the world.

"We are excited and confident in the ability of Vyaire Medical to build the Respiratory Solutions business into a leading, global respiratory-focused organization," said Tom Polen, executive vice president and president of BD's Medical Segment. "We look forward to the continued partnership with Apax Partners through this joint venture, and to seeing the even greater impact that Vyaire Medical will have on customers and patients as a fully focused respiratory care company."

BD plans to use net proceeds for share repurchases, subject to market conditions. In fiscal year 2017, due to the limited profitability of the business today, BD anticipates earnings dilution of approximately $0.10 to $0.14, net of share repurchases. The company expects to record a material tax loss on the transaction at the time of closing.

J.P. Morgan Securities LLC acted as financial advisor to BD and Skadden, Arps, Slate, Meagher & Flom served as legal advisor.



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