H.B. Fuller Company FUL has inked agreements to acquire two major medical adhesive technology companies — GEM S.r.l. and Medifill Ltd. 

Medifill is an Ireland-based formulator and maker of medical-grade cyanoacrylate adhesives with cutting-edge clean room and manufacturing facilities. It manufactures sophisticated technologies designed exclusively for the wound closure market. The next-generation formulas allow for fast, safe and successful wound closure. GEM is an Italy-based manufacturer and market leader in medical adhesives and unique application devices, with approval and certification for more than 80 internal indications. 

The acquisition establishes a European headquarters for H.B. Fuller's Medical Adhesive Technologies ("MAT") division and broadens the company's medical adhesive solutions, further transforming its portfolio to highly profitable, high-growth industries.

These purchases add to H.B. Fuller's prior investments in the tissue adhesives market, which included the acquisition of Cyberbond in 2016, Tissue Seal in 2021 and Adhezion Biomedical in 2023, significantly broadening the company's global MAT business and geographical reach.

When the two companies are combined, net revenues and adjusted EBITDA for 2024 are estimated to be €23 million and €11.5 million, respectively. H.B. Fuller's Hygiene, Health, and Consumable ("HHC") Adhesives Global Business Unit ("GBU") will house the two businesses. The acquisitions will be closed at a pre-synergy EBITDA multiple of 15.5X and a three-year post-synergy EBITDA multiple of 9.5X for a total purchase price of €180 million.

Shares of FUL have lost 4.4% over the past year compared with 6.6% decline of its industry.

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FUL’s Rank & Key Picks

H.B. Fuller currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the basic materials space include Carpenter Technology Corporation CRS, DuPont de Nemours, Inc. DD and CF Industries Inc. CF. 

Carpenter Technology currently carries a Zacks Rank #1 (Strong Buy). CRS beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 14.1%. The company's shares have soared 181.7% in the past year. You can see the complete list of today's Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for DD’s current-year earnings is pegged at $3.88 per share, indicating a year-over-year rise of 11.5%. DD, a Zacks Rank #2 (Buy) stock, beat the consensus estimate in each of the last four quarters, with the average earnings surprise being 12.9%. The company's shares have rallied roughly 15.8% in the past year.

The Zacks Consensus Estimate for CF’s current-year earnings is pegged at $6.32 per share. CF, a Zacks Rank #1 stock, beat the consensus estimate in two of the last four quarters while missed twice, with the average earnings surprise being 10.3%. CF has rallied around 20.3% in the past year.

 

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