DCC Healthcare significantly expands in medical devices with its largest acquisition to date
Scale platform in European medical devices sector
DCC plc, the leading international sales, marketing, and support services group, announces that DCC Healthcare has agreed to acquire Medi-Globe Technologies GmbH ("Medi-Globe”), an international medical devices business focused on minimally invasive procedures. The transaction represents DCC Healthcare’s largest acquisition to date and is a further material expansion of DCC Vital’s presence in the European healthcare market, following on from the acquisition of primary care supplier Wörner Medical in May 2021.
The acquisition is based on an enterprise value of approximately €245 million (£213 million) on a cash-free, debt-free basis and the consideration will be settled in cash on completion. The acquisition is expected to generate a mid-teen return on capital employed in three years. The transaction is subject to competition authority approval in Germany and France and is expected to complete in calendar Q4 2022.
Medi-Globe, founded in 1990, is involved in the development, manufacture and distribution of single-use devices for endoscopy in diagnostic and therapeutic procedures. The business has grown organically and through bolt-on acquisitions to become a leading global player in its focus areas of gastroenterology and urology. These are large and growing therapeutic areas, benefiting from strong demographic and treatment trends. Medi-Globe has revenues of approximately €120 million (£104 million) and employs approximately 600 people. Its products are sold to hospitals and procurement organisations in over 120 countries through direct sales operations in Germany, France, Austria, Netherlands, Czechia and Brazil; and an international network of distributors. The business has significant regulatory and R&D capability with a strong development pipeline of innovative proprietary products. Medi-Globe sources its products from high quality manufacturers, as well as its own cleanroom facility in Czechia. Its highly experienced management team will continue to lead the business from its headquarters in Bavaria, Germany.
DCC Vital’s growth strategy is principally focused on building its international presence in own-brand medical devices and in primary care supplies and services. DCC Vital’s existing own-brand medical devices activities are focused on the areas of minimally invasive surgery, cardiac monitoring and anaesthesia. The addition of Medi-Globe creates an international platform of scale in single-use devices with high-quality product development, regulatory and manufacturing capability; direct sales and marketing infrastructure in eight countries and an extensive international distributor network. The acquisition will provide meaningful synergy opportunities, in particular through leveraging DCC Vital and Medi-Globe’s respective product portfolios and commercial infrastructures.
Donal Murphy, Chief Executive of DCC plc, said today:
"We are delighted to welcome Medi-Globe into the DCC Group. The synergistic acquisition of Medi-Globe significantly expands and enhances DCC Vital’s position in the medical devices sector. It will create a leading international platform in single-use medical devices for minimally invasive procedures, with strong product development capability.
The acquisition of Medi-Globe and other recent acquisitions in DCC Healthcare and DCC Technology are consistent with our ambition to really scale our operations in these higher growth sectors. We are very pleased with DCC Vital’s progress in expanding its market positions beyond Britain and Ireland - we now have strong European growth platforms in both medical devices and primary care supplies."