Rockwell Medical Inc. in Wixom, a health care company that develops, manufactures, commercializes, and distributes a portfolio of hemodialysis products to dialysis providers worldwide, is expanding.
The company acquired the hemodialysis concentrates business from Evoqua Water Technologies in Troy for $11 million up front in cash, plus two milestone payments of $2.5 million each at 12- and 24-months from the closing of the transaction.
Rockwell Medical purchased the business unit through its cash balance. At the closing of the transaction, Rockwell Medical stated it had approximately $15.3 million in cash and cash equivalents.
The acquisition is expected to add a profitable business that generates approximately $18 million in annual revenue and will add more than $3.3 million in annual EBITDA for Rockwell Medical.
It also will significantly expand Rockwell Medical’s geographic footprint, customer base, and product offerings while at the same time giving the company fully automated manufacturing know-how and capacity.
With the acquisition Rockwell Medical is increasing its 2023 revenue guidance to between $82 million and $86 million.
Under the terms of the agreement, Rockwell Medical acquired all of Evoqua’s concentrates business which includes contracts, intellectual property, U.S. Food and Drug Administration 510(k) clearances, and assets primarily associated with Evoqua’s concentrates business nationwide, including liquid and powder bicarbonate and liquid acid.
Evoqua’s operations are fully automated and afford Rockwell the opportunity to manufacture its hemodialysis concentrates products at a lower cost and add significant capacity to the Company’s production line.
By assuming responsibility for Evoqua’s concentrates customer contracts, Rockwell can expand its footprint in the United States and assume a larger market share of the already growing hemodialysis concentrates market. Additionally, the company will now become the leading supplier of liquid bicarbonate products to dialysis centers in the U.S.
“We are excited by this acquisition and believe that the transaction is transformative for our business,” says Mark Strobeck, president and CEO of Rockwell Medical. “Evoqua’s hemodialysis concentrates business is profitable, complementary to Rockwell’s business, and immediately accretive to our top and bottom line.
“Additionally, this transaction enhances Rockwell’s presence in the hemodialysis marketplace and offers us technological solutions that will enable us to automate our processes and add significant capacity to our production line. This is the first of many opportunities that we plan to pursue so that we can serve more clinics, and in turn, more patients.”
