Medtronic Prepares Sale of Medical-Supplies Business

  • Medical-devices company could sell all or part of unit
  • Sale of entire business could fetch as much as $5 billion

Medtronic Plc, the largest medical-devices company in the world, is working with advisers to prepare the sale of part or all of its sprawling medical-supplies business, according to people familiar with the matter.

While preparations for a sale are at an early stage, Medtronic has sounded out prospective buyers for the division, the people said, asking not to be identified as the matter isn’t public. The unit could be valued at as much as $5 billion, the people said.

A spokesman for Medtronic declined to comment. The company’s shares rose 1.3 percent to $77 at 5:05 p.m. in New York late trading, after earlier closing up 1.8 percent.

Offloading the medical-supplies business, which sells everything from needles and catheters to monitoring equipment and medical instruments, would mark the disposal of mainly legacy assets from Medtronic’s $42.9 billion acquisition of Covidien Plc, announced in 2014.  

It’s unclear whether Medtronic will pursue a single deal or split the medical supplies business into smaller divestitures. 

The combined assets had earnings before interest, taxes, depreciation and amortization of about $500 million, one of the people said. They’re likely to fetch a multiple of eight to 10 times that amount, the person said.

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