Hologic To Sell Blood Screening Business To Grifols For $1.85 Bln

(RTTNews) - Hologic Inc. (HOLX) said that it agreed to sell its share of its blood screening business to long-time commercial partner, Grifols (GRFS), for gross proceeds of $1.85 billion in cash. The transaction has been approved by the boards of directors of both companies.

As per the agreement, Grifols will receive a fully paid-up license to certain of Hologic's intellectual property for use in the blood screening field.  Approximately 175 people, mainly in operations and research and development, will transfer to Grifols, along with Hologic's blood screening manufacturing facility in Rancho Bernardo, California. 

Hologic will retain the engineering expertise that led to the development of the fully automated TIGRIS and Panther systems, but will partner with Grifols to ensure that blood screening customers continue to benefit from state-of-the-art instrumentation over the long term.

For all of Hologic's fiscal 2017, the Company's share of the blood screening business was forecast to contribute approximately $240 million of revenue, GAAP earnings per shareof $0.19, and non-GAAP earnings per share of $0.34.  Hologic expects to update its financial guidance for fiscal 2017 after the transaction closes.

The transaction is expected to close in the first quarter of calendar 2017, subject to customary conditions such as the expiration or termination of any applicable waiting periods under antitrust laws.

Grifols said it expects the transaction will positively impact group margins and bolster generation of operating cash flows. The revenues of the Diagnostic Division will not change as a result of this acquisition due to the existing joint-business between Grifols and Hologic in place since 2014. Under the existing arrangement, Grifols owns customer facing activities and records all revenues. In this respect, the Diagnostic Division's sales will continue to represent around 16% of Grifols' total revenue.

Grifols said it will finance the acquisition with $1.700 billion term loan and existing cash on the balance sheet. The term loan has been arranged and fully underwritten by Nomura.

The agreement does not include any financial restrictions relating to Grifols' dividend or investment policies. The acquisition has been unanimously approved by the boards of directors of both companies.