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Contract sterilization company Sterigenics up for sale — Reuters

NEW YORK (Reuters) – Sterigenics International LLC, a provider of contract sterilization services to the medical device and food industries, is exploring a sale that could value it at as much as $1.5 billion, including debt, according to people familiar with the matter.

Sterigenics’ owner, private equity firm GTCR LLC, has asked investment banks Goldman Sachs Group Inc (GS.N: Quote, Profile, Research, Stock Buzz) and Jefferies LLC to run a sale process for the company, three people said this week.

The move comes just two months after Sterigenics acquired Nordion, a provider radioactive isotopes for the global health science market, for $826 million. The deal was largely driven by Sterigenics’ desire to secure the supply of a cobalt isotope that is used in the sterilization of medical devices and tools.

Following that acquisition, Sterigenics has annual earnings before interest, tax, depreciation and amortization of more than $130 million, one of the people said.

The sources asked not to be identified because the sale process is not public. GTCR, Goldman Sachs and Jefferies declined to comment, while Sterigenics did not respond to a request for comment.

Based in Deerfield, Illinois, Sterigenics operates out of 43 facilities in 11 countries across the Americas, Europe and Asia. GTCR acquired Sterigenics in 2011 for $675 million from another private equity firm, Silverfleet Capital.
ews of the sale process for Sterigenics comes a week after U.S. medical technology company Steris Corp (STE.N: Quote, Profile, Research, Stock Buzz) offered to buy British sterilization services provider Synergy Health Plc (SYR.L: Quote, Profile, Research, Stock Buzz) for about $1.9 billion in cash and stock, in a deal that would shift its domicile to Britain and cut its tax bill.

Moody’s Investors Service Inc said earlier this week that Sterigenics will face increasing competitive pressure over the medium to long term as a result of Steris’ acquisition of Synergy Health.

This adds to the challenges that Sterigenics faces in assimilating Nordion, which is vulnerable to supply-chain disruptions, according to Moody’s.