Avantor upping its single-use game in $2.9bn Masterflex buy

Avantor is set to acquire Masterflex, a manufacturer of peristaltic pumps and aseptic single-use fluid transfer tech used in upstream, downstream and fill-finish services.

The deal, announced yesterday, “strengthens Avantor’s offering across all bioproduction platforms including monoclonal antibodies (mAbs), cell and gene therapy and mRNA, and supports both therapy and vaccine manufacturing including COVID-19,” the firm said in a statement.

The $2.9 billion transaction ($2.7 billion after tax benefits) will add Vernon Hills, Illinois-headquartered tech firm Masterflex to the biopharma services firm’s offerings. Masterflex is a manufacturer of pumps and single-use tubing and assembly systems used in the bioprocess space.

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“The acquisition of Masterflex reflects our commitment to the biopharma industry, and our ability to identify and execute on value-creation opportunities,” said Michael Stubblefield, CEO of Avantor.

“The business enhances our portfolio of proprietary technologies and strengthens our position in the highest growth segments of the market.”

The all-cash transaction was welcomed by analysts, with Evercore ISI’s Vijay Kumar saying the price paid suggests that the bid was competitive.

“From a headline EPS [earnings per share] perspective, this isn’t particularly heroic…that said, from a long-term strategic perspective, we think the deal will be a home run for Avantor,” Kumar wrote in an investor note.

“The asset fits in the right area – Bioprocessing end markets growing double-digits, and single use tech is growing well above. Masterflex provides Avantor an attractive entry point in a long-term secular market.”

Providing the deal closes, Masterflex is expected to bring in around $300 million of revenues for Avantor in FY 2022 – 80% of this coming from biomanufacturing clients.