Medical device maker Teleflex Inc said on Tuesday it would buy privately-held NeoTract Inc in a deal valued at up to $1.1 billion to strengthen its portfolio of urology devices.
NeoTract’s flagship device is the minimally invasive UroLift System, which treats lower urinary tract symptoms due to an age-related urine disorder called benign prostatic hyperplasia, reports Reuters.
Teleflex said it will pay NeoTract an upfront payment of $725 million when the deal closes, expected within the next 30 days, and an additional $375 million when it hits certain sales milestones through 2020.
NeoTract’s revenue is expected to be between $115 million and $120 million this year and is expected to grow at least 40 percent in 2018, the companies said. Teleflex said the deal will help its revenue growth in the mid-single digit percentage region for the next several years.
The company’s devices are used in urology, cardiac, respiratory and emergency care, and in December last year it strengthened its coronary and vascular business with the $1 billion acquisition of Vascular Solutions Inc.
Guggenheim Securities is Teleflex’s financial adviser and Simpson Thacher & Bartlett LLP its legal adviser. J.P. Morgan Securities LLC is advising NeoTract and Wilson Sonsini Goodrich & Rosati is its legal counsel. Teleflex’s shares closed at $210.51 on Friday, having gained about 31 percent in 2017.