BD (Becton, Dickinson and Company) has announced a definitive agreement to sell 50.1 percent of its Respiratory Solutions business to funds advised by Apax Partners and form a joint venture that will operate as a new, independent company.

The new company will include all business lines within BD's Respiratory Solutions business including ventilation, respiratory diagnostics, vital signs, and AirLife, and have estimated annual revenue of approximately USD 900 million. The new company will employ more than 5000 associates around the world. BD will retain 49.9 percent of the company as a significant but non-controlling minority owner.

The transaction values the entire business at nearly USD 500 million. The structure of the transaction reflects the completion of a thorough strategic review process and BD's determination that the business is noncore to its long-term strategy. By maintaining a significant but non-controlling minority ownership position, BD intends to maximize value by participating in future earnings and the anticipated appreciation in valuation.

The transaction is expected to close in late fiscal year 2016 or early fiscal year 2017. Due to the proximity to the end of its fiscal year 2016, BD expects an immaterial impact to its fiscal year 2016 guidance. BD plans to use net proceeds for share repurchases, subject to market conditions. The company expects to record a material tax loss on the transaction at the time of closing.

The completion of the transaction is subject to pending regulatory approval, consultations with employee representative bodies in Europe, and customary closing conditions.

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