Henry Schein to Acquire a Majority Interest in Shield Healthcare, a Leading Supplier of Homecare Medical Products to Patients in the Home; Expands Henry Schein Medical’s Continuum-of-Care Delivery Model

Rhea-AI Summary

Henry Schein, Inc. (Nasdaq: HSIC) announces acquisition of majority ownership in Shield Healthcare, a leading supplier of homecare medical products. The deal enhances Henry Schein Medical's continuum-of-care delivery model and expands its homecare medical products platform to over $300 million in annualized revenue. The transaction is expected to be completed in the third quarter of 2023.

Positive

• Expansion into the homecare medical supplies market is aligned with the growing trend of care moving into the home, potentially positioning Henry Schein for future growth.

Negative

• None.

MELVILLE, N.Y.--(BUSINESS WIRE)-- Henry Schein, Inc. (Nasdaq: HSIC), the world’s largest provider of health care solutions to office-based dental and medical practitioners, announced today that it has signed an agreement to acquire a majority ownership position in Shield Healthcare, Inc., a leading supplier of homecare medical products delivered directly to patients in their homes. The addition of Shield Healthcare will advance Henry Schein Medical’s continuum-of-care delivery model.

The Shield Healthcare agreement follows Henry Schein’s 2021 acquisition of Prism Medical Products LLC, and represents a further investment in the homecare medical supplies market delivering products directly to patients in their homes. With this acquisition, Henry Schein’s homecare medical products platform will have a revenue base of more than $300 million in annualized revenue. The Shield Healthcare transaction enhances Henry Schein's existing medical business by delivering a wide range of products, including incontinence, urology, ostomy, enteral nutrition, advanced wound, and diabetes supplies, as well as continuous glucose monitoring devices, directly to patients in their homes.

Headquartered in Valencia, Calif., Shield Healthcare had 2022 net sales of approximately $180 million. Henry Schein expects the transaction to be neutral to 2023 non-GAAP earnings per share and accretive thereafter. Closing is subject to standard closing conditions and is expected to be completed in the third quarter of 2023. Financial terms were not disclosed.

“As the U.S. population ages and care increasingly moves into the home, Henry Schein is meeting this trend by enhancing our homecare medical products offering,” said Stanley M. Bergman, Chairman of the Board and Chief Executive Officer of Henry Schein. “We are delighted to expand our presence in delivering medical products directly to patients through Shield Healthcare. Together, we share an unwavering commitment to customer satisfaction.”

Shield Healthcare will operate as a part of Henry Schein Medical, which reported global sales for 2022 of $4.45 billion. The current owners of Shield Healthcare, including members of the company’s management team, will retain the remaining minority ownership position in the company.

About Henry Schein, Inc.

Henry Schein, Inc. (Nasdaq: HSIC) is a solutions company for health care professionals powered by a network of people and technology. With more than 22,000 Team Schein Members worldwide, the Company's network of trusted advisors provides more than 1 million customers globally with more than 300 valued solutions that help improve operational success and clinical outcomes. Our Business, Clinical, Technology, and Supply Chain solutions help office-based dental and medical practitioners work more efficiently so they can provide quality care more effectively. These solutions also support dental laboratories, government and institutional health care clinics, as well as other alternate care sites.

Henry Schein operates through a centralized and automated distribution network, with a selection of more than 300,000 branded products and Henry Schein private-brand products in stock.

A FORTUNE 500 Company and a member of the S&P 500® index, Henry Schein is headquartered in Melville, N.Y., and has operations or affiliates in 32 countries and territories. The Company's sales reached $12.6 billion in 2022, and have grown at a compound annual rate of approximately 12.1 percent since Henry Schein became a public company in 1995.

For more information, visit Henry Schein at www.henryschein.com, Facebook.com/HenrySchein, Instagram.com/HenrySchein, and Twitter.com/HenrySchein.

Cautionary Note Regarding Forward-Looking Statements

In accordance with the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995, we provide the following cautionary remarks regarding important factors that, among others, could cause future results to differ materially from the forward-looking statements, expectations and assumptions expressed or implied herein. All forward-looking statements made by us are subject to risks and uncertainties and are not guarantees of future performance. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance and achievements or industry results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These statements are generally identified by the use of such terms as “may,” “could,” “expect,” “intend,” “believe,” “plan,” “estimate,” “forecast,” “project,” “anticipate,” “to be,” “to make” or other comparable terms. A fuller discussion of our operations, financial condition, and status of litigation matters, including factors that may affect our business and future prospects, is contained in documents we have filed with the United States Securities and Exchange Commission, or SEC, including our Annual Report on Form 10-K, and will be contained in all subsequent periodic filings we make with the SEC. These documents identify in detail important risk factors that could cause our actual performance to differ materially from current expectations. Forward looking statements include the overall impact of the Novel Coronavirus Disease 2019 (COVID-19) on the Company, its results of operations, liquidity and financial condition (including any estimates of the impact on these items), the rate and consistency with which dental and other practices resume or maintain normal operations in the United States and internationally, expectations regarding personal protective equipment (“PPE”) products and COVID-19 related product sales and inventory levels, whether additional resurgences or variants of the virus will adversely impact the resumption of normal operations, whether supply chain disruptions will adversely impact our business, the impact of integration and restructuring programs as well as of any future acquisitions, general economic conditions including exchange rates, inflation and recession, and more generally current expectations regarding performance in current and future periods. Forward looking statements also include the (i) ability of the Company to have continued access to a variety of COVID-19 test types, expectations regarding COVID-19 test sales, demand and inventory levels, as well as the efficacy or relative efficacy of the test results given that the test efficacy has not been, or will not have been, independently verified under normal FDA procedures, and (ii) potential for the Company to distribute the COVID-19 vaccines and ancillary supplies.

Risk factors and uncertainties that could cause actual results to differ materially from current and historical results include, but are not limited to: risks associated with COVID-19 and any variants thereof, as well as other disease outbreaks, epidemics, pandemics, or similar wide-spread public health concerns and other natural disasters; our dependence on third parties for the manufacture and supply of our products; our ability to develop or acquire and maintain and protect new products (particularly technology products) and technologies that achieve market acceptance with acceptable margins; transitional challenges associated with acquisitions, dispositions and joint ventures, including the failure to achieve anticipated synergies/benefits; legal, regulatory, compliance, cybersecurity, financial and tax risks associated with acquisitions, dispositions and joint ventures; certain provisions in our governing documents that may discourage third-party acquisitions of us; adverse changes in supplier rebates or other purchasing incentives; risks related to the sale of corporate brand products; effects of a highly competitive (including, without limitation, competition from third-party online commerce sites) and consolidating market; the repeal or judicial prohibition on implementation of the Affordable Care Act; changes in the health care industry; risks from expansion of customer purchasing power and multi-tiered costing structures; increases in shipping costs for our products or other service issues with our third-party shippers; general global and domestic macroeconomic and political conditions, including inflation, deflation, recession, fluctuations in energy pricing and the value of the U.S. dollar as compared to foreign currencies and changes to other economic indicators, international trade agreements, potential trade barriers and terrorism; failure to comply with existing and future regulatory requirements; risks associated with the EU Medical Device Regulation; failure to comply with laws and regulations relating to health care fraud or other laws and regulations; failure to comply with laws and regulations relating to the collection, storage and processing of sensitive personal information or standards in electronic health records or transmissions; changes in tax legislation; risks related to product liability, intellectual property and other claims; litigation risks; new or unanticipated litigation developments and the status of litigation matters; risks associated with customs policies or legislative import restrictions; cyberattacks or other privacy or data security breaches; risks associated with our global operations; our dependence on our senior management, employee hiring and retention, and our relationships with customers, suppliers and manufacturers; and disruptions in financial markets. The order in which these factors appear should not be construed to indicate their relative importance or priority.

We caution that these factors may not be exhaustive and that many of these factors are beyond our ability to control or predict. Accordingly, any forward-looking statements contained herein should not be relied upon as a prediction of actual results. We undertake no duty and have no obligation to update forward-looking statements except as required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230802534109/en/

Investors

Ronald N. South

Senior Vice President and Chief Financial Officer

ronald.south@henryschein.com

(631) 843-5500

Graham Stanley

Vice President, Investor Relations and Strategic Financial Project Officer

graham.stanley@henryschein.com

(631) 843-5500

Media

Ann Marie Gothard

Vice President, Global Corporate Media Relations

annmarie.gothard@henryschein.com

(631) 390-8169

Source: Henry Schein

FAQ

What is the ticker symbol of Henry Schein, Inc.?

The ticker symbol of Henry Schein, Inc. is HSIC.

What is the expected revenue base of Henry Schein's homecare medical products platform after the acquisition?

The acquisition is expected to expand Henry Schein's homecare medical products platform to over $300 million in annualized revenue.

What is the expected impact on Henry Schein's non-GAAP earnings per share in 2023?

The transaction is expected to be neutral to 2023 non-GAAP earnings per share and accretive thereafter.

When is the closing of the transaction expected to be completed?

The closing is subject to standard closing conditions and is expected to be completed in the third quarter of 2023.