Henry Schein, Inc. HSIC has decided to acquire 85% interest in Denmark-based veterinary equipment supplier and distributor, Jorgen Kruuse A/S. The remaining 15% will be retained by the Kruuse family.
The acquisition, which marks Henry Schein’s foray into the Nordic animal health market, is expected to be neutral to the company’s earnings per share from the date of closing (expected in the third quarter of 2015) through the end of the year, and accretive thereafter. However, financial terms of the deal remain undisclosed.
Apart from its presence in the Nordic countries, Jorgen Kruuse is a growing provider of veterinary products and services internationally. The company currently has an operational base in Poland, the U.K. and China. The company, with annual sales of $90 million in 2014, should help extend Henry Schein's geographic presence to Denmark, Norway and Sweden.
Moreover, the takeover, once complete, will expand Henry Schein's animal health business to 23 countries, including the U.S., Australia, New Zealand, Canada, China, Malaysia and 17 countries in Europe.
Henry Schein’s revenue growth has been consistently supported by niche acquisitions. Naturally, the company has been on an acquisition spree over a couple of years. The Jorgen Kruuse takeover plan comes close on the heels of several other recent acquisitions in animal health that include scil animal care in Germany, Maravet in Romania and SmartPak in the U.S. All these buyouts are deemed a strategic fit for Henry Schein, as they are expected to help the company gain solid market share through robust organic growth.
According to Henry Schein, these acquisitions are in line with the company’s strategy for geographic expansion, brand development and revenue growth. Post completion of the Jorgen Kruuse deal, the company plans to expand the reach of Kruuse's line of products to animal health markets in Europe, North America, Australia and New Zealand. While Henry Schein will bring to Jorgen Kruuse valuable resources and expertise, the latter will facilitate the consolidation of its animal health business across Europe.
Zacks Rank
Currently, the stock carries a Zacks Rank #3 (Hold). Better-ranked stocks in the med/dental-supply industry include AmerisourceBergen Corporation ABC, CR Bard Inc. BCR and Laboratory Corp. of America Holdings LH. All the three stocks carry a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment