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OMI Reshapes Portfolio With $375 Million Sale to Platinum Equity
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Key Takeaways
OMI to divest Products & Healthcare Services segment to Platinum Equity for $375M.
OMI streamlines portfolio to focus solely on higher-margin, faster-growing home-based care market.
OMI gains cash proceeds, retains tax assets and 5% equity stake for long-term value creation.
Owens & Minor (OMI - Free Report) recently signed a definitive agreement to sell its Products & Healthcare Services ("P&HS") segment to Platinum Equity for $375 million in cash, while retaining a 5% equity stake.
The move positions the company as a pure-play leader in the fast-growing home-based care market, a segment that has been central to its strategic narrative in recent years. By focusing exclusively on Patient Direct operations, Owens & Minor aims to unlock higher profitability, simplify its business model, and align valuation more closely with peers in the home health sector.
The deal is expected to be closed by the end of 2025, subject to regulatory approvals. Once completed, Owens & Minor will emerge with a streamlined portfolio, sharper market focus, and improved financial flexibility, marking a pivotal moment in its ongoing transformation journey.
Likely Share Price Movement
Shares of Owens & Minor have plunged 65% so far this year against the industry’s growth of 5.3%. The S&P 500 Index has gained 15.6% in the period.
Image Source: Zacks Investment Research
Owens & Minor’s divestiture of its Products & Healthcare Services segment is expected to lift investor sentiment as it transitions into a pure-play home-based care platform. The $375 million cash infusion, tax benefits, and equity retention could drive a modest near-term rally and support stronger long-term valuation multiples.
Financial and Tax Benefits Strengthen Outlook
Beyond the upfront cash proceeds, the transaction delivers additional financial levers for Owens & Minor. The retained equity interest provides the potential to capture upside value creation if Platinum Equity successfully grows the divested business.
Moreover, the preservation of more than $150 million in federal net operating loss carryforwards and other tax attributes enhances balance sheet flexibility and supports future earnings. These retained benefits not only cushion the short-term impact of the divestiture but also create optionality for future capital deployment — whether through reinvestment in core operations, debt reduction, or enhanced shareholder returns.
Growth Agenda for P&HS
Platinum Equity, known for its operational expertise and history of managing corporate carve-outs, plans to strengthen the P&HS platform as an independent business. The private equity firm sees significant potential in scaling the segment’s global supply chain and healthcare service capabilities. Its investment underscores confidence in the long-term relevance of P&HS, even as Owens & Minor narrows its focus. For customers and suppliers, the transaction offers continuity under a buyer experienced in healthcare and logistics, promising targeted investment to meet evolving industry needs.
The divestiture redefines Owens & Minor as a focused home-based care player with greater strategic clarity. Analysts are likely to view the transaction as value-enhancing, given that the home health sector commands premium valuations compared to diversified supply businesses.
By dedicating resources to its Patient Direct platform, the company is better positioned to deliver consistent revenues and margin expansion. At the same time, the equity retention in P&HS ensures that Owens & Minor participates in any future upside.
Masimo’s shares have lost 10.4% so far this year compared with the industry’s 7.4% decline. Estimates for the company’s 2025 earnings per share have increased 1.3% to $5.30 in the past 30 days. MASI’s earnings beat estimates in each of the trailing four quarters, the average surprise being 13.8%. In the last reported quarter, it posted an earnings surprise of 8.1%.
Estimates for Merit Medical’s 2025 earnings per share have increased 0.8% to $3.63 in the past 60 days. Shares of the company have lost 13.8% so far this year against the industry’s 1.1% growth. MMSI’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 12.92%. In the last reported quarter, it delivered an earnings surprise of 17.44%.
Estimates for West Pharmaceutical’s 2025 earnings per share have increased 1.2% to $6.74 in the past 60 days. Shares of the company have lost 18.2% so far this year against the industry’s 1% growth. WST’s earnings beat estimates in each of the trailing four quarters, the average surprise being 16.81%. In the last reported quarter, it delivered an earnings surprise of 21.85%.
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OMI Reshapes Portfolio With $375 Million Sale to Platinum Equity
Key Takeaways
Owens & Minor (OMI - Free Report) recently signed a definitive agreement to sell its Products & Healthcare Services ("P&HS") segment to Platinum Equity for $375 million in cash, while retaining a 5% equity stake.
The move positions the company as a pure-play leader in the fast-growing home-based care market, a segment that has been central to its strategic narrative in recent years. By focusing exclusively on Patient Direct operations, Owens & Minor aims to unlock higher profitability, simplify its business model, and align valuation more closely with peers in the home health sector.
The deal is expected to be closed by the end of 2025, subject to regulatory approvals. Once completed, Owens & Minor will emerge with a streamlined portfolio, sharper market focus, and improved financial flexibility, marking a pivotal moment in its ongoing transformation journey.
Likely Share Price Movement
Shares of Owens & Minor have plunged 65% so far this year against the industry’s growth of 5.3%. The S&P 500 Index has gained 15.6% in the period.
Image Source: Zacks Investment Research
Owens & Minor’s divestiture of its Products & Healthcare Services segment is expected to lift investor sentiment as it transitions into a pure-play home-based care platform. The $375 million cash infusion, tax benefits, and equity retention could drive a modest near-term rally and support stronger long-term valuation multiples.
Financial and Tax Benefits Strengthen Outlook
Beyond the upfront cash proceeds, the transaction delivers additional financial levers for Owens & Minor. The retained equity interest provides the potential to capture upside value creation if Platinum Equity successfully grows the divested business.
Moreover, the preservation of more than $150 million in federal net operating loss carryforwards and other tax attributes enhances balance sheet flexibility and supports future earnings. These retained benefits not only cushion the short-term impact of the divestiture but also create optionality for future capital deployment — whether through reinvestment in core operations, debt reduction, or enhanced shareholder returns.
Growth Agenda for P&HS
Platinum Equity, known for its operational expertise and history of managing corporate carve-outs, plans to strengthen the P&HS platform as an independent business. The private equity firm sees significant potential in scaling the segment’s global supply chain and healthcare service capabilities. Its investment underscores confidence in the long-term relevance of P&HS, even as Owens & Minor narrows its focus. For customers and suppliers, the transaction offers continuity under a buyer experienced in healthcare and logistics, promising targeted investment to meet evolving industry needs.
The divestiture redefines Owens & Minor as a focused home-based care player with greater strategic clarity. Analysts are likely to view the transaction as value-enhancing, given that the home health sector commands premium valuations compared to diversified supply businesses.
By dedicating resources to its Patient Direct platform, the company is better positioned to deliver consistent revenues and margin expansion. At the same time, the equity retention in P&HS ensures that Owens & Minor participates in any future upside.
Owens & Minor, Inc. Price
Owens & Minor, Inc. price | Owens & Minor, Inc. Quote
OMI’s Zacks Rank and Key Picks
Owens & Minor currently has a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks in the broader medical space are Masimo (MASI - Free Report) , Merit Medical System (MMSI - Free Report) and West Pharmaceutical Services (WST - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Masimo’s shares have lost 10.4% so far this year compared with the industry’s 7.4% decline. Estimates for the company’s 2025 earnings per share have increased 1.3% to $5.30 in the past 30 days. MASI’s earnings beat estimates in each of the trailing four quarters, the average surprise being 13.8%. In the last reported quarter, it posted an earnings surprise of 8.1%.
Estimates for Merit Medical’s 2025 earnings per share have increased 0.8% to $3.63 in the past 60 days. Shares of the company have lost 13.8% so far this year against the industry’s 1.1% growth. MMSI’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 12.92%. In the last reported quarter, it delivered an earnings surprise of 17.44%.
Estimates for West Pharmaceutical’s 2025 earnings per share have increased 1.2% to $6.74 in the past 60 days. Shares of the company have lost 18.2% so far this year against the industry’s 1% growth. WST’s earnings beat estimates in each of the trailing four quarters, the average surprise being 16.81%. In the last reported quarter, it delivered an earnings surprise of 21.85%.