Teleflex Hits 52-Week Low On Plan To Split Into Two Companies, Reports Mixed Q4 Earnings

On Thursday, Teleflex Incorporated TFX will pursue a plan to separate into two new, independent, publicly traded companies:

• New, independent, publicly traded company (NewCo) consisting of Teleflex’s Urology, Acute Care, and OEM businesses.
• RemainCo will consist of Teleflex’s Vascular Access, Interventional, and Surgical businesses, focusing on high-growth, high-acuity, primarily hospital-focused emergent end markets.

The separation is expected to be completed by mid-2026.

“Following the separation, RemainCo will be well-positioned to accelerate growth in attractive, primarily hospital-focused, emergent end markets, with a simplified operating model, streamlined manufacturing footprint, and increased management focus,” said Liam Kelly, Teleflex’s Chairman, President, and CEO.

RemainCo had approximately $2.1 billion in revenue in 2024.

Concurrently, Teleflex agreed to acquire the Vascular Intervention business of Biotronik SE & Co. KG for approximately 760 million euros ($791.6 million). The acquisition is expected to be completed by the end of the third quarter of 2025.

RemainCo is expected to generate constant currency revenue growth of over 6%. RemainCo will have a simplified and nimble operating model with a streamlined manufacturing footprint, transitioning from 19 manufacturing facilities anticipated at Teleflex as of year-end 2025 to 7 facilities at RemainCo post-separation, with the remaining 12 expected to transfer to NewCo.

The transaction is also expected to be accretive to EPS growth, with RemainCo anticipated to deliver double-digit EPS growth in the first full year following the separation.

NewCo, with approximately $1.4 billion in revenue in 2024, is also expected to benefit from a simplified operating model. NewCo is expected to generate low-single digit constant currency revenue growth with a mid-50% adjusted gross margin profile.

Teleflex will initiate an executive search for key management positions at NewCo shortly.

Teleflex also reported fourth-quarter sales of $795.4 million, up 2.8% year over year (+3.2% on constant currency), missing the consensus of $813.23 million. The medical devices company reported adjusted EPS of $3.89, beating the consensus of $3.86.

Guidance: Teleflex expects 2025 revenue growth of (0.4)% to 0.7%, with adjusted EPS of $13.95-$14.35 versus consensus of $15.23.

CFO transition: Teleflex announced that Thomas Powell, the company’s CFO, will retire, effective April 1. John R. Deren, currently serving as Corporate Vice President and Chief Accounting Officer, will succeed Mr. Powell as Executive Vice President and Chief Financial Officer, effective April 2.

Price Action: TFX stock is down 21.6% at $139.35 at the last check Thursday.

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