Steris to acquire Cantel Medical in $3.6B equity deal

Ireland's Steris PLC is acquiring Little Falls, N.J.-based Cantel Medical Corp. for an equity value of approximately $3.6 billion.

Cantel common stockholders will receive about $16.93 in cash and 0.33787 of a Steris ordinary share, valuing their holdings at $84.66 per Cantel common share.

The transaction represents a total enterprise value of about $4.6 billion when including Cantel's net debt and convertible notes.

Cantel — which provides infection prevention products and services primarily to endoscopy and dental customers — had generated annual revenue of about $1 billion in its fiscal year ended July 31, 2020.

The companies expect to realize annualized pretax cost savings of about $110 million by the fourth fiscal year following the close of the deal.

Cantel's largest business unit — called medical portfolio — will expand Steris' endoscopy offerings and Cantel's dental business would extend the Dublin-based medical device company into a new customer segment, Steris said in a Jan. 12 press release.

Steris expects to fund the cash portion of the deal and repay a significant amount of Cantel's existing debt with about $2 billion of new debt. Steris has obtained a fully committed bridge financing for which JPMorgan Chase Bank NA served as sole lead arranger and book runner.

The transaction is expected to close by June 30, subject to customary closing conditions including approvals from regulators and Cantel stockholders. Cantel Chairman Charles Diker, along with certain other entities holding about 10% of Cantel's outstanding shares, have agreed to vote in favor of the acquisition.

Guggenheim Securities is financial adviser, while Jones Day is legal counsel to Steris.

Centerview Partners LLC is exclusive financial adviser to Cantel, while Wachtell Lipton Rosen & Katz is legal counsel.