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Private equity groups TPG and Blackstone are seeking more than $4bn for medical technology company Hologic’s surgical unit, as they pay down debt and return cash from one of last year’s biggest leveraged buyouts.
The investment firms are working with advisers on a sale of the division that specialises in making surgical equipment used by gynaecologists, according to people familiar with the matter. The sale — which is likely to draw interest from private equity and strategic buyers — was still in the early stages and might not result in a transaction, they added.
TPG and Blackstone, along with the sovereign wealth funds Mubadala and GIC, of Abu Dhabi and Singapore, respectively, took Hologic private in an $18.3bn deal that ranked as the second biggest public-to-private deal of the year behind the $55bn leveraged buyout of Electronic Arts. The deal officially closed in April.
The potential sale comes as the private equity industry is under increasing pressure to return cash to investors and as stubbornly high interest rates weigh on buyout groups’ appetite for dealmaking.
Blackstone over the past year has returned increasing amounts of cash to investors, selling down nearly $50bn in private equity investments through the sales of broadband internet company Hotwire and the initial public offerings of medical devices company Medline Industries and industrials group Legence, among others.
TPG and Blackstone declined to comment.
Several medical technology companies are exploring sales of all or parts of their business. Eyecare group CooperCompanies last year announced a strategic review that is likely to lead to the disposal of its eye surgery unit, while medtech research and development outsourcer Integer Holdings is also conducting a strategic review.
Private equity deals made up a smaller proportion of overall deals in the first half of this year, compared with the same period last year, falling from 24.8 per cent to 21 per cent. Globally the value of healthcare deals jumped 83.2 per cent year on year to $271bn.
