Headquartered in New York, KKR & Co. is now the largest non-index fund shareholder in Henry Schein after taking a 12 per cent stake in the medical and dental supply company.
The announcement, first reported by The Wall Street Journal on Wednesday, gives KKR the option to increase its stake to almost 15 per cent. The two companies will “collaborate to pursue additional opportunities to create shareholder value and drive the business in its next phase of growth,” Henry Schein said in a statement.
The main goal is to help Henry Schein, which is also headquartered in New York and has a market value of about $9.5 billion, improve its operations. The company reported preliminary revenue of $3.2 billion in the fourth quarter, bringing total revenue to $12.7 billion for the year.
Two KKR representatives — Max Lin and William K. Daniel — will join Henry Schein’s board as independent directors. The company also appointed Robert J. Hombach, former chief financial officer of Baxalta Inc., as an independent director.
The news comes amid a trend of increased private equity investment in the dental sector.
According to a paper released in August by the ADA Health Policy Institute, the percentage of dentists affiliated with private equity almost doubled over six years. The institute’s data showed private equity affiliation grew from 6.6 per cent in 2015 to 12.8 per cent in 2021, particularly among larger dental practices and specialists such as endodontists, oral surgeons, pediatric dentists, orthodontists and prosthodontists.
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