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Diving certificate:
- UFP Technologies has agreed to buy The medical technology component manufacturer AQF Medical has taken over the purchase price for 43 million euros (48 million dollars), UFP announced in a securities announcement on Monday.
- AQF, based in Navan, Ireland, designs and manufactures custom foam and thermoplastic components for medical devices and packaging. UFP manufactures single-use devices and sterile packaging.
- Analysts at Keybanc Capital Markets said in a note to investors that the acquisition is likely to add complementary capabilities and scale to UFP’s portfolio and support the company’s expansion outside the U.S.
Diving insight:
Based in Newburyport, Massachusetts UFP has expanded through acquisitions in recent years. From October 2021 to March 2022 the company bought Advant Medical, DAS Medical and Contech Medical for a total of nearly $100 million. Following the sale of its subsidiary Molded Fiber Technology in July 2022, UFP launched another round of acquisitions this year.
The company the acquisitions completed of Marble Medical, AJR Enterprises and Welch Fluorocarbon between June 24 and July 15. UFP said the purchase of the companies will increase revenue by an estimated $90 million and expand its capabilities in medical skin adhesives, specialty tissues and implant materials.
Keybanc analysts discussed three areas where UFP and recent acquisition AQF overlap. The two companies are working on: specialty thermoplastic polyurethane products such as packaging for orthopedics and covers for surgical equipment, including robotics; polyurethane foam for negative pressure wound therapy; and antiseptic applicators for skin preparation.
Analysts said the valuation was slightly higher than the historical average for UFP deals, “but appears reasonable based on the available information.”
UFP CEO R. Jeffrey Bailly said AQF brings Expertise in the processing of specialty foams and films, an expansion of production in Europe requested by customers and a joint venture branch in Singapore.
The companies share numerous customers, the CEO said, and have served similar segments and applications for years.This overlap gives UFP a “deep understanding” of AQF’s processes and materials, Bailly said in a statement.
Seamus Fagan, managing director of AQF, said his company’s local knowledge could help UFP attract new customers in Asia and Europe.