LATHAM, N.Y. - Medical technology firm AngioDynamics , Inc. (NASDAQ: NASDAQ:ANGO) has divested its peripherally inserted central catheter (PICC) and Midline product lines to Spectrum Vascular for a deal that could reach $45 million. The sale, which includes a $34.5 million payment at closing, an earnout of $5.5 million, and a $5 million milestone payment, is part of the company's strategic refocus on growing its core Med Tech platforms.
The divested product lines, which also involve tip location devices, accounted for roughly $43.5 million in AngioDynamics' fiscal year 2023 revenue. Additionally, AngioDynamics has ceased the sale of its Uniblate and Starburst Radio Frequency ablation products and Syntrax support catheter products, which contributed about $5.5 million in annual sales.
President and CEO Jim Clemmer stated that this divestiture is a significant step in the company's transformation, aiming to drive growth and profitability in its NanoKnife, Mechanical Thrombectomy, and Auryon businesses. Clemmer also noted that the transaction strengthens the company's balance sheet and optimizes its product portfolio.
The sale is expected to reduce AngioDynamics' fiscal 2024 revenue by approximately $50 million but is projected to be accretive to the full-year fiscal 2024 gross margin. The company will also cut certain sales, marketing, and operational expenses in connection with the divestiture and restructuring, which is anticipated to be slightly dilutive to fiscal 2024 adjusted earnings per share.
Spectrum Vascular, the acquiring company, is a growing provider in the vascular access market. The acquisition provides them with established product lines and a skilled commercial team, which is expected to continue to serve patient needs effectively.
AngioDynamics will provide updated fiscal 2024 financial guidance during its fiscal third-quarter earnings call in early April. UBS Investment Bank and Cadwalader, Wickersham & Taft advised AngioDynamics on the transaction, while Fried Frank acted as legal advisor to Spectrum Vascular.
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