Clayton, Dubilier & Rice (CD&R) have entered an agreement under which CD&R-managed funds will make a significant equity investment alongside existing management in Drive DeVilbiss Healthcare, a global manufacturer of medical products. Terms of the transaction were not disclosed.
Formed in 2000, Drive has a strong and consistent track record of growth achieved both organically and through acquisitions. The company’s diverse product portfolio, channel footprint, and global operating scale were strategically built by its executive leadership team to take advantage of favorable underlying demographic and industry trends. Drive’s products include a full suite of mobility, respiratory, sleep, bath and personal care, specialty beds, pressure prevention, rehabilitation and other related products, and are sold into the homecare, long-term care, retail, and e-commerce channels. Drive serves a customer base of more than 15,000 dealers, home healthcare providers, healthcare distributors, retailers, and e-commerce companies and sells its branded products in more than 80 countries around the world.
“Drive’s management team has done an exceptional job of identifying and capitalizing on the increasing demand for its products across multiple channels,” says CD&R partner Richard J. Schnall in a release. “We intend to play a constructive role by supporting a very talented management team as it continues to grow the business organically and through acquisitions, pursue operational excellence, and serve its customers with the highest quality products.”
Since 2002, Drive has completed 25 acquisitions that have expanded its product portfolio, geographic reach, and manufacturing capabilities. In July 2015, Drive completed the acquisition of DeVilbiss Healthcare, a global manufacturer of respiratory and sleep products. The acquisition provided Drive with a strong platform and a significant cross-selling opportunity in the fast-growing respiratory and sleep market segments, while increasing the company’s manufacturing capabilities and its market presence around the world. Since the successful integration of DeVilbiss, Drive has operated under the name of Drive DeVilbiss Healthcare.
Derek Strum, CD&R principal, adds: “We believe Drive has substantial runway for continued organic growth given the company’s strong value proposition, partnership approach with its customers, and significant product breadth. Drive also has a strong pipeline of acquisitions, which should result in continued robust growth in the years ahead.”
“We look forward to partnering with CD&R and tapping into the firm’s capabilities as we continue to execute our strategy based on expanding our product lines and geographic reach, providing rewarding career opportunities, and, most importantly, enhancing the quality of life of the people we touch,” says Harvey Diamond, chairman and CEO of Drive.
Richard Kolodny, president of Drive, says, “As successful as we have been since our founding in 2000 and with the support we received from Ferrer Freeman & Company over the past 8 years, we believe that our growth story is just beginning. With CD&R as our partner, we are confident that we will realize the full potential of the company.”
CD&R has obtained committed financing from Barclays, JPMorgan Chase Bank, N.A., Citigroup Global Markets, Inc., Capital One, National Association, and HSBC Securities (USA) Inc. Barclays, J.P. Morgan Securities LLC, and Citi acted as financial advisors and Debevoise & Plimpton LLP acted as legal advisor to CD&R in connection with the transaction, which is expected to close in the fourth quarter of 2016. Drive’s financial advisor was Robert W. Baird & Co., and its legal advisor was Bryan Cave LLP.