Benzinga | Mar 12, 2021 09:32AM EST

Cardinal Health To Divest Cordis Business For $1B

Cardinal Health Inc (NYSE: CAH) has agreed to sell its Cordis business to Hellman & Friedman, a private equity firm, for approximately $1 billion.

* The deal value includes the buyer's assumption of certain liabilities and the seller's retention of certain working capital accounts.

* Cordis develops and manufactures interventional vascular technology.

* The company says that the Cordis divestiture will help it focus on strategic growth areas - such as medical distribution and global medical products businesses.

* Cardinal Health will retain full authority for lawsuits related to inferior vena cava filters in the U.S. and Canada, as well as the liability associated with these matters.

* Cardinal Health estimates that its Medical segment profit will decrease by approximately $60 million to $70 million on an annual run-rate basis after completion of the divestiture.

* The company will classify the Cordis business as held for sale, which it expects to result in a pre-tax loss of up to $120 million in the third quarter of its fiscal year 2021.

* Additionally, Cardinal Health was authorized to incur costs associated with the planned divestiture of up to $125 million, primarily in its fiscal years 2021 and 2022.

* The transaction will close in 2022.

* Price Action: CAH shares are trading 0.52% higher at $56.19 in premarket trading on the last check Friday.