by John R. Fischer
, Senior Reporter | March 15, 2022
Word in the healthcare space is that Merit Medical Systems is considering a buyout from a private equity firm.
Unnamed sources familiar with the matter said the company, which is valued at $3.5 billion, is consulting an investment bank and has attracted interest from buyout firms, according to Reuters
The sources, who asked not to be identified due to the confidential nature of the matter, said there is no certainty that a deal will be reached.
Merit Medical is located in South Jordan, Utah, where it manufactures and sells medical solutions for cardiology, radiology, oncology, critical care and endoscopy.
The news of a possible sale of the company sent its shares up Wednesday by 6.2% to $64.99 in afternoon trading in New York.
Investment firm Starboard Value LP and its affiliates own 87% of Merit Medical’s common stock. In 2020, Starboard reached an agreement with the company that saw the appointment of three new independent directors to Merit Medical’s board of directors.
Earlier this month, the company scored FDA breakthrough device designation for its Embosphere Microspheres for the genicular artery embolization (GAE) indication. GAE is a procedure for reducing pain and disability caused by knee osteoarthritis. It works by decreasing blood flow to the knee and minimizing the inflammatory process.
Greater demand for elective procedures that were disrupted during the pandemic has led to greater interest among private equity firms in the healthcare industry. Blackstone Group, Carlyle Group and Hellman & Friedman, for instance, acquired medical supply firm Medline Industries
in 2021 for $34 billion.
The deal was one of the largest leveraged buyouts since the 2018 financial crisis and potentially the largest healthcare LBO ever, according to The Wall Street Journal. Medline is using funding from the investment to extend its product portfolio and expand internationally, as well as make new infrastructure investments to build up its global supply chain. The company continues to be led by the Mill Family and remains the largest single shareholder.
Additionally, Hellman & Friedman, along with Bain Capital, acquired athenahealth
just last month for $17 billion. The deal provides its customers with access to the athenaOne cloud platform, which offers modules designed to address patient engagement, revenue cycle, telehealth, payments, population health, and value-based care management.
It also puts them in contact with more than 140,000 ambulatory care providers that are partnered with athenahealth and spread out across all 50 states, and make up over 120 specialties.
A Merit Medical spokesperson did not immediately respond to Reuter’s request for comment about any potential sale.