March 12, 2021 – Cardinal Health (Dublin, OH) announced it has signed a definitive agreement to sell its Cordis business to Hellman & Friedman (H&F) for approximately $1 billion, which includes buyer’s assumption of certain liabilities and seller’s retention of certain working capital accounts.
After closing, most assets and liabilities associated with the Cordis business will transfer to H&F. Cardinal Health will retain full authority for lawsuits related to inferior vena cava filters in the United States and Canada, as well as liability associated with these matters.
Cardinal Health estimates that, after completion of the transition services agreement, the divestiture of the Cordis business will decrease Medical segment profit by approximately $60 million to $70 million on an annual run-rate basis.
In connection with the entry into this definitive agreement, Cardinal Health will classify the Cordis business as held for sale, which Cardinal Health expects to result in a pre-tax loss of up to $120 million in the third quarter of its fiscal year 2021. Additionally, Cardinal Health was authorized to incur costs associated with the planned divestiture of up to $125 million, primarily in its fiscal years 2021 and 2022.
Cordis, which develops and manufactures medical devices for diagnostics and interventional procedures to treat patients suffering from coronary and peripheral vascular diseases, was acquired by Cardinal Health in 2015 from Johnson & Johnson for $1.94 billion.
“Our decision to divest Cordis demonstrates our disciplined approach to evaluating our portfolio and focusing our resources in our strategic growth areas where we are an advantaged owner,” said Mike Kaufmann, CEO of Cardinal Health. “Looking forward, we remain committed to our medical distribution and global medical products businesses.”
The transaction is expected to close in the first half of Cardinal Health’s fiscal year 2022, subject to customary closing conditions and regulatory clearances.