Dive Brief:
- CooperCompanies bought some of Cook Medical’s obstetrics, doppler monitoring and gynecology surgery products for $300 million, the companies announced on Wednesday.
- The acquisition follows an attempt by Cooper to acquire Cook’s reproductive health business, which was scrapped amid scrutiny from the Federal Trade Commission.
- The assets included in the purchase do not include any of the fertility products the companies had discussed in the original deal, Cooper said.
Dive Insight:
Cooper paid $200 million upfront and will pay two more annual installments of $50 million each. In exchange, it will acquire Cook’s Bakri postpartum balloon, cervical ripening balloon, doppler blood flow monitor portfolio and other surgical products.
Cooper CEO Al White said in the deal announcement that the acquired devices “are highly synergistic” with the company’s current portfolio and will strengthen its position in fertility and women’s health.
San Ramon, California-based Cooper’s surgery segment includes fertility, gynecology and obstetrics products, including equipment for in-vitro fertilization and the non-hormonal IUD Paragard. The segment reported $1.07 billion in sales last year.
The purchase is much smaller than Cooper’s planned $875 million acquisition of Cook’s reproductive health business, announced in 2022. That deal would have included minimally invasive fertility, obstetrics and gynecology devices, which Cooper saw as an opportunity to bolster its presence in the Asia-Pacific region.
As the acquisition faced scrutiny from regulators, the companies sought other ways to close it, including selling certain Cook assets, before finally calling off the deal in August, with Cooper paying a $45 million termination fee.
The products Cooper bought Wednesday differ from those in the original agreement, and they brought in approximately $56 million in revenue for the 12 months ending Sept. 30. Cooper expects revenues from the acquisition to grow from 5% to 7% on a constant currency basis in its 2024 fiscal year. The deal is also expected to contribute to the company’s earnings per share by $0.20, excluding one-time charges and deal-related amortization.
Cook said it will continue to manufacture the products for at least two years. Manufacturing will transfer to Cooper during that period.
