Thursday, May 6, 2021

    Medline Industries Explores Sale

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    Medline Industries Explores Sale

    Medline Industries has hired Goldman Sachs to run the sale process.

    Medline Industries has hired Goldman Sachs to run the sale process.

    Photo: brendan mcdermid/Reuters

    Medline Industries Inc. is exploring a sale that could value the big medical-supply company at as much as $30 billion and mark the latest in a recent string of large leveraged-buyout bids.

    The family-owned company has hired
    Goldman Sachs
    Group Inc. to run the process, according to people familiar with the matter. There is no guarantee the company will ultimately be sold. The process is at an early stage, the people said, with some adding that an IPO or minority investment is also a possibility.

    Northfield, Ill.-based Medline is likely to attract private-equity bidders, partly because industry players could struggle to swallow such a big rival, the people said.

    Blackstone Group Inc.,
    KKR
    & Co. and
    Carlyle Group Inc.
    are among those expected to consider bids, some of the people said, and they could ultimately partner up given the size of the deal.

    The possible deal is the latest sign of a renaissance under way for large leveraged buyouts, which largely disappeared in the wake of the financial crisis as firms eschewed pairing up and taking on the mountains of debt such deals require. With risk tolerance rising broadly and private-equity investors sitting on mountains of unspent cash, the firms have been testing the waters lately on megabuyouts again, including at
    Royal KPN
    NV and
    Toshiba Corp.

    Medline manufactures and distributes medical equipment and supplies used in hospitals, surgery centers, acute-care and other medical facilities in over 125 countries. It had $17.5 billion in annual sales, according to its website.

    The company’s products include surgical gowns, examination gloves and diagnostic equipment used in medical settings as well as a few consumer-facing brands such as Curad bandages. The company says its drapes and gowns are used in eight million procedures in the U.S. a year.

    Founded in 1966 by brothers James and Jon Mills, the company’s roots date to 1910 when their grandfather, A.L. Mills, started sewing butcher aprons in Chicago. He was approached by nuns who worked at a nearby hospital and he offered to help them with sewing surgeons’ gowns and nurses’ uniforms, according to the website.

    The company went public in 1972, but the Mills brothers bought back the shares five years later after concluding investors were undervaluing it.

    James Mills, who served for many years as Medline’s CEO, died in 2019. His son Charlie took over as CEO in 1997 and currently holds the position.

    Write to Miriam Gottfried at [email protected] and Cara Lombardo at [email protected]

    Published at Sat, 10 Apr 2021 21:57:00 +0000