Carlyle beats buyout competition to agree $4.15bn J&J diagnostics unit deal


BPL monitorGlobal buyout house The Carlyle Group has agreed a $4.15bn deal for Johnson & Johnson’s diagnostics unit Ortho Clinical after fighting off competition from private equity peers.

Bain Capital, BC Partners and the pairing of Leonard Green & Partners and CVC Capital were previously said to be interested in buying the business, which provides medical screening, diagnosis and monitoring equipment in 130 countries.

The bulk of the purchase will be made through $2.15bn of term loans, $1.15 of bonds and up to $400m in revolving credit according to Reuters, which cited sources with knowledge of the deal earlier this week.

Carlyle managing director Stephen Wise said, “Ortho-Clinical Diagnostics is an established global brand with a reputation for quality and innovation.

“Through accelerated investment in research and product development and continued expansion into both emerging and established markets, we expect to tap into rising demand for sophisticated medical diagnostic products and services worldwide.

“We have been focused on the diagnostics industry for many years given its attractive growth prospects, driven by the crucial role it plays in health care decision-making and influencing patient outcomes.

“We believe that OCD, with its world class employee base and talented management team, is poised for the next level of success.”

Carlyle said equity for the deal came from Carlyle Partners VI, the $13bn US buyout fund it closed in November 2013.

Carlyle has invested $6.3bn of equity in healthcare transactions around the globe in companies including Pharmaceutical Product Development, Grupo Qualicorp, Healthscope, HCR ManorCare and MultiPlan.

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