A group of private-equity firms including Blackstone Group is close to purchasing Medline Industries in a deal that values the medical supply company at more than $30 billion, the Wall Street Journal reported Saturday, in what stands to be a huge payday for the Mills family, who told Forbes in February 2020 that they owned 100% of the company.
The deal is worth about $34 billion, according to the WSJ, and excluding debt, values Medline at more than $30 billion.
After the buyout, the Mills family will remain the single largest stockholder in the company and the same management team will remain, according to the WSJ.
With roots going back to 1910, Medline was founded in 1966 by brothers James and Jon Mills, who took it public in 1972, then took it private again five years later. Charlie Mills, James’ son, has served as Medline’s CEO since 1997. At the onset of the pandemic last year, Medline ramped up production of such items as bleach products, face masks, surgical gowns, disinfecting wipes and toilet paper. The company’s president, Andy Mills, told Forbes, “the volume [of calls seeking supplies] is off the charts… I literally can’t go an hour without getting some kind of request in my mailbox.”
The buyout of Medline, which could be the largest LBO yet in the healthcare industry, could lead to a resurgence in “club deals,” whereby several private-equity firms join forces to acquire a company, Bloomberg reported last month. These transactions lost some favor after the financial crisis as investors in multiple PE funds weren’t comfortable having too much cash exposed to the same assets. The biggest leveraged buyout in history, the $45 billion takeover of utility TXU Corp. was a club deal. It ended up in bankruptcy in 2013.
What To Watch For
In late May, Christina Minnis, Goldman Sachs global head of acquisition finance, said she expected to see some large LBOs this year. Already Goldman has underwritten five deals of at least $10 billion each, putting it on pace to break its record of eight such deals for a year.
LBO Madness (Forbes)
The Homemade LBO (Forbes)