Invacare sells Altimate Medical
ELYRIA, Ohio – Invacare has made the next move in its turnaround plan.
The company announced Aug. 29 that it has sold Altimate Medical, maker of the EasyStand stationary standing assistive devices, to Rockwood Equity Partners, a private investment firm, for $23 million in cash.
“Altimate is a strong business, but it is outside Invacare’s core North America/Home Medical Equipment product portfolio,” stated Rob Gudbranson, interim president and CEO, in a release. “The net proceeds from this divestiture give us the opportunity to strengthen our balance sheet through the continued reduction of debt.”
Invacare estimates it will realize net proceeds of about $21.7 million from the sale of Altimate Medical, net of tax and expenses. It will use the proceeds to reduce debt outstanding under its revolving credit facility.
For the six months ended June 30, 2014, Altimate Medical’s net sales were about $8.9 million and earnings before tax before any pro forma adjustments were about $2.3 million, according to the release.
The Morton-Minn.-based Altimate Medical has 40 independent reps and 2,500 dealers across the United States and sells its products in more than 30 countries, according to an article in the St. Cloud Times.
New York City-based Rockwood Equity Partners focuses on investing in lower middle market companies with revenues typically between $10 million and $100 million. It teamed with St. Cloud, Minn.-based Granite Equity Partners to acquire Altimate Medical, according to the Times.
Earlier in August, Invacare announced that it would reduce its workforce by 190 employees, a move that it says will save up to $15 million annually on a pre-tax basis when fully instituted in 2015. At the time, Lara Mahoney, director of investor relations and corporate communications, called the reduction “one piece of our turnaround plan.”
The sale of Altimate Medical is subject to a $1 million escrow arrangement and further subject to certain post-closing adjustments.