Switzerland-based TE Connectivity Ltd. (NYSE:TEL), a world leader in connectivity and sensors, has agreed to acquire Ireland-based medical devices manufacturer Creganna Medical from global investment firm Permira for $895 million in an all cash transaction.
Permira had acquired Creganna for €223 million in 2010, reportedly achieving a 3.4x return on the sale to TE. Under Permira’s ownership, Creganna was significantly transformed from a medical component manufacturer to a global leader in end-to-end manufacturing for the minimally invasive vascular surgery market. During the past five years its revenue grew from $131 million in 2010 to $249 million in 2015. “This outcome was achieved through the recruitment of a world class management team, two strategic acquisitions – Precision Wire Components and ABT- that shaped an end-to-end offering, a global footprint and a competitive cost position as well as positioning the company as a leader in two high growth markets – electrophysiology and structural heart,” says Permira.
“The acquisition of Creganna Medical is part of our well-established strategy to expand our leadership position in harsh environment applications,” said TE Connectivity chairman and CEO Tom Lynch. “This transaction builds on our AdvancedCath acquisition and establishes TE as a leading supplier to the high-growth minimally invasive interventional segment. Our existing medical product offering, coupled with these acquisitions, positions TE with the broadest range of products and technologies serving this high-growth space.”
“We are pleased to be joining TE Connectivity to continue our journey to become the leading supplier of minimally invasive medical device delivery and access solutions for interventional medicine,” said Chip Hance, CEO of Creganna Medical.
“We are very proud to have worked with Creganna to develop its business into high growth markets, expand its global footprint, enhance its technical capabilities and deepen its customer partnerships over the past five years,” said Mike Garland of Permira.
The sale of Creganna marks the second divestment managed by Permira’s global healthcare team in a few months and follows last years’ sale of the world’s leading aquatic health group Pharmaq to Zoetis Inc. The team was established in 2008 and is led by Mubasher Sheikh.
Upon completion of the transaction, the business will be reported as part of TE’s Industrial Solutions segment. The deal is subject to the receipt of certain regulatory approvals and is expected to close in the third quarter of fiscal year 2016. The transaction will be financed through cash and debt.
TE’s financial advisor was Morgan Stanley & Co. LLC and outside counsel was Davis Polk & Wardwell LLP. Piper Jaffray acted as exclusive financial adviser to the Permira funds and Skadden, Arps, Slate, Meagher & Flom LLP acted as legal advisers.
Creganna Medical is ranked among the top 10 global companies in the medical device outsourcing industry. The company specializes in the design and manufacture of minimally invasive delivery and access devices for a range of therapies. Serving over 400 companies across 30 countries, Creganna Medical’s customers include the world’s leading medical device and life science companies. Headquartered in Galway, Ireland, Creganna Medical has a global operational footprint with design and manufacturing facilities spanning the U.S., South America, Europe and Asia.
TE Connectivity is a $12 billion global technology leader. Its connectivity and sensor solutions are essential in today’s increasingly connected world. The company collaborate with engineers to transform their concepts into creations – redefining what’s possible using intelligent, efficient and high-performing TE products and solutions proven in harsh environments. Its 72,000 people, including over 7,000 engineers, partner with customers in close to 150 countries across a wide range of industries. The company was formerly known as Tyco Electronics Ltd. and changed its name to TE Connectivity Ltd. in March 2011. TE Connectivity Ltd. was incorporated in 2000 and is based in Schaffhausen, Switzerland.
Permira is a global investment firm that finds and backs successful businesses with ambition. Founded in 1985, the firm advises funds with a total committed capital of approximately €25 billion (US$28 billion). The Permira funds make long-term investments in companies with the ambition of transforming their performance and driving sustainable growth. In the past 30 years, the Permira funds have made over 200 private equity investments in five key sectors: Consumer, Financial Services, Healthcare, Industrials and Technology. Current healthcare investments include Pantheon Healthcare Group. Permira employs over 200 people in 14 offices across North America, Europe, the Middle East and Asia. The firm was founded in 1985 and operated under the Schroder Ventures brand. After raising its first pan-European fund in 1997, the firm became Permira following a rebrand in 2001.