AngioDynamics Sells PICC and Midline Product Portfolios for $45M

Spectrum Vascular is buying the assets.

I Stock 1412647653 Haneefa Nizamudeen

AngioDynamics, a medical technology company focused on restoring healthy blood flow in the body’s vascular system, expanding cancer treatment options and improving patient quality of life, today announced that it has completed the sale of its PICC and Midline product portfolios to Spectrum Vascular, a medical device company focused on vascular access and medication management, for up to $45 million in cash.

The transaction consists of AngioDynamics’ PICC, Midline and tip location products. This combined portfolio of products contributed approximately $43.5 million in annual sales during AngioDynamics’ fiscal year 2023.

The company also announced that it has discontinued the sale of its Uniblate and Starburst Radio Frequency products, as well as its Syntrax support catheter products to further streamline its product portfolio. These products contributed approximately $5.5 million in annual sales during AngioDynamics’ fiscal year 2023.

The transaction consideration consists of $34.5 million paid at closing, an earnout related to sales of the divested products over the next two years equal to $5.5 million, and a milestone payment of $5 million paid upon final transfer of the manufacturing of the divested products to a third-party manufacturer.

The assets divested and discontinued today, along with the assets divested in June, will be accounted for as discontinued operations, removing their impact from the company’s fiscal 2024 results. The divestiture of the PICC and Midline businesses, together with the discontinuance of the radiofrequency ablation and Syntrax businesses, will reduce full-year fiscal 2024 revenue by approximately $50 million. The Company expects that the divestiture of the PICC and Midline businesses, together with the discontinued businesses, will be accretive to full-year fiscal 2024 gross margin.

In connection with the transactions announced today, the company will eliminate certain sales, marketing and operational expenses. Today’s transaction, inclusive of the restructuring, is expected to be slightly dilutive to fiscal 2024 adjusted earnings per share.

The company will provide updated fiscal 2024 financial guidance on its fiscal third quarter earnings call in early April.

UBS Investment Bank is serving as financial advisor, and Cadwalader, Wickersham & Taft is serving as legal advisor to AngioDynamics. Fried Frank is serving as legal advisor to Specturm Vascular.

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