Cardinal Health, a provider of medical products, pharmaceuticals, and solutions that enhance supply chain efficiency, has announced the sale of its Cordis business to Hellman & Friedman for $1 billion. The deal price reflects the fact that Hellman & Friedman will assume the liabilities of Cordis while Cardinal will retain most of its working capital accounts.
The move to sell Cordis represents a relatively quick turnaround for Cardinal considering it just acquired the business in 2015 from Johnson & Johnson. Notably, the purchase price for Cordis was $1.94 billion in 2015, so the sale price announced Friday reflects a significant mark-down.
Profits at Cardinal’s Medical segment are expected to be $60 million to $70 million lower following the transaction, based on the current run rate of Cordis. The company is also expecting to incur expenses of roughly $125 million between ‘21 and ‘22 associated with the divestiture of the business.
J.P. Morgan advised Cardinal on the deal while UBS advised Hellman & Friedman. The deal is expected to close in the front half of FY 2022 for Cardinal.