Sweden’s SCA to buy German bandage and plaster cast maker BSN Medical for $2.9 bn

Swedish consumer goods company Svenska Cellulosa AB (SCA) today struck a deal to buy German bandage and plaster cast maker BSN Medical from private equity firm EQT Partners for €2.74 billion ($2.9 billion) including debt.

The sale comes ahead of BSN Medical's plan to separate into two publicly traded parts in 2017.

The acquisition will be fully debt funded and SCA said that it has committed credit facilities in place.

SCA expects to realize annual synergies of at least €30 million in three years after closing.

BSN Medical, which specialises producing branded products in the areas of compression therapy, wound care and orthopaedics was established in 2001 as a joint venture between Beiersdorf AG, Hamburg, and Smith & Nephew plc and later acquired by Montagu Private Equity.

EQT, which acquired BSN Medical from Montagu in 2012 for €1.8 billion, had been exploring a sale of Leukoplast, Cutimed and Actimove brands maker, and had hired Morgan Stanley and JPMorgan Chase to conduct an auction.

The Hamburg-based company's brands include Leukoplast, Cutimed, JOBST, Delta Cast, Delta Lite and Actimove which are long established brand leaders in their key markets.

It sells its products in more than 140 countries, has production facilities in 11 countries and employs around 6,000 people.

BSN medical reported 2015 net sales of €861 million and adjusted EBITDA of €201 million and net sales for the first nine months of 2016 of €627 million.

''This acquisition will significantly strengthen SCA's customer offering, channel presence and market access. This will further strengthen and develop SCA's global market leading position within incontinence products under the TENA brand,'' said, Magnus Groth, president and CEO of SCA.

With a market cap of around $19.1 billion, Stockholm-based SCA is global hygiene and forest products company producing personal care, tissue and forest products.

Its leading global brands include Tena and Tork, and regional brands, such as Libero, Libresse, Lotus, Nosotras, Saba, Tempo, Vinda and Zewa.

The group has about 44,000 employees and annual sales of around €12.3 billion.