Platinum Equity submitted a binding offer to acquire LifeScan from Johnson & Johnson in a transaction valued at approximately $2.1 billion. LifeScan manufactures blood glucose monitoring products with 2017 net revenue of approximately $1.5 billion.
Reuters reported Bank of America Merrill Lynch is providing the entire debt commitment, but will carve out a portion, possibly as high as 60%, to other banks.
“We have great respect for Johnson & Johnson and appreciate their confidence in our ability to execute,” said Platinum Equity Chairman and CEO Tom Gores. “This is an important investment for us in a business that serves millions of patients around the world. We are committed to putting our financial resources and global operating expertise to work in support of the company’s core mission to improve the quality of life for people living with diabetes.”
Headquartered in Chesterbrook, PA and Zug, Switzerland, LifeScan serves approximately 20 million patients globally in more than 90 countries.
“LifeScan has been a leader in diabetes care for more than 30 years and has consistently developed and brought to market industry leading products,” said Platinum Equity Partner Jacob Kotzubei. “We have worked closely with Johnson & Johnson to craft a divestiture solution for LifeScan that would create a global standalone business and set the stage for continued investment in growth and innovation.”
LifeScan President Valerie Asbury is expected to continue leading the business following the change in ownership.
The acceptance period for the offer will end on June 15, 2018, unless extended, and during that time, consultations with relevant works councils are planned. If the offer is accepted, the transaction would be expected to close by the end of 2018, subject to the satisfaction of customary closing conditions.
Morgan Lewis is serving as legal advisor to Platinum Equity.
Founded in 1995 by Tom Gores, Platinum Equity is a global investment firm with $13 billion of assets under management and a portfolio of more than 30 operating companies that serve customers around the world.
