Chemical giant DuPont de Nemours Inc. closed the sale of its $1.75 billion acquisition of medical device manufacturer Spectrum Plastics Group, the company announced on Tuesday.
DuPont bought the manufacturer from private equity firm AEA Investors, which acquired Spectrum in 2018.
Spectrum Plastics Group is a long-time customer of DuPont, using the company’s popular Tyvek in its sterile medical packaging. DuPont will house Spectrum under its industrial solutions business within the electronics and industrial segment, which fits well with its Liveo and Tyvek brands, DuPont Executive Chairman and CEO Ed Breen told analysts on an earnings call Wednesday.
“We are excited by Spectrum’s complementary fit and specifically our ability to leverage incremental growth opportunities, including synergies from cross-selling and the complementary accounts new and faster product development and deeper design and co-development partnerships with OEMs,” Breen said.
The medical device manufacturer will focus on fast-growing therapeutic areas such as structural heart, electrophysiology, surgical robotics and cardiovascular to complement DuPont’s existing biopharma brands, including Liveo silicone solutions and Tyvek medical packaging. The new partnership will help the chemical giant increase its total healthcare market revenue to about 10% of its portfolio.
The acquisition is slated to lead to $20 million in cost synergies for DuPont, the company said.
“It probably will take the better part of 12 to 18 months to get $20 million out,” EVP and CFO Lori Kock told investors. “I mean, obviously, for us, it is more of a revenue synergy opportunity as we bring the two portfolios together in verge our expertise biopharma with their expertise in medical device comes from a revenue synergy perspective.”
While it’s been busy acquiring companies, DuPont has also been selling off some of its own businesses. In November, the company sold the majority of its former mobility and materials segment to fellow chemical manufacturer Celanese for $11 billion.
DuPont is currently working on selling its Delrin acetal homopolymer business, which the company announced in February 2022. Delrin is used as material in parts designed to replace metal, including gears, safety restraints components and conveyor belt components.
The company expects to close the Delrin sale by the end of the year.
