Steris to acquire Cantel Medical in $4.6B deal

MedTech News: STERIS has announced its acquisition of Cantel Medical.

Cantel Medical adds to STERIS’ infection control business with a collection of endoscopy products and launches the company into the dental market.

From a local perspective, Cantel Australia was set up in the last few years and repossessed the commercial rights to its products from long-term distributor C.R. Kennedy.

STERIS’ acquisition provides a potential growth opportunity for the Cantel Australia team as STERIS does not currently have a local affiliate set up in Australia. Although no changes have been confirmed or announced for the short-term, STERIS may look to move the distribution of its current product portfolio from local distributor Device Technologies to Cantel Medical in the future.

“We have long appreciated Cantel, which is a natural complement and extension to STERIS’s product and service offerings, global reach and Customers,” said Walt Rosebrough, President and Chief Executive Officer of STERIS. “Our companies share a similar focus on infection prevention across a range of healthcare Customers. Combined, we will offer a broader set of Customers a more diversified selection of infection prevention and procedural products and services. We welcome the people of Cantel to the STERIS team and firmly believe we will create greater value for our Customers and shareholders together.”

Charles M. Diker, Chairman of the Cantel Board of Directors, said, “We are pleased to reach this agreement with STERIS, which is the culmination of a robust process to achieve an outcome that allows Cantel shareholders to participate in the significant upside of the combined company, while also providing them with immediate cash value. Together with STERIS, we believe the value opportunity is compelling, both today and in a post-COVID world, as the combined company will have the scale, breadth and depth to unlock substantial value that will drive further benefits for Cantel shareholders, Customers and all stakeholders.”

“We believe Cantel and STERIS are a perfect strategic fit, and this combination is a natural next step for our company, enabling us to accelerate progress on our Cantel 2.0 initiatives and drive enhanced value for shareholders and the healthcare providers and systems we support,” said George Fotiades, CEO of Cantel. “The last year has demonstrated more than ever the importance of innovative and comprehensive infection prevention and control solutions that protect healthcare providers and patients. Together with STERIS, we will be able to provide a more extensive and innovative suite of offerings to our Customers around the world. Importantly, STERIS recognizes that our proven and talented team is the foundation of Cantel’s success and we look forward to working collaboratively to bring our two organisations together.”

This transaction brings together STERIS’s and Cantel’s franchises to create a stronger global business serving a broader set of customers. Cantel’s largest business, its Medical portfolio, will strengthen and expand STERIS’s Endoscopy offerings, adding a full suite of high-level disinfection consumables, capital equipment and services, as well as additional single-use accessories.

Cantel’s Dental business extends STERIS into a new customer segment where there is an increasing focus on infection prevention protocols and processes. Annual revenue for Cantel in its recent fiscal year ended July 31, 2020, was approximately $1 billion.

STERIS will acquire Cantel for a total equity value of approximately $3.6 billion and a total enterprise value of approximately $4.6 billion.

STERIS also recently expanded its market presence with the $850 million purchase of Key Surgical in October 2020.