- Neogen (NEOG, Financial) is selling its cleaners and disinfectants business to Kersia Group for $130 million in cash plus contingent consideration.
- The sale will allow Neogen to repay $100 million of its revolving credit facility, reducing its net leverage ratio by 0.4x.
- The transaction is expected to close in Q1 of fiscal year 2026 and is anticipated to be margin-accretive.
Neogen Corporation (NASDAQ: NEOG) has entered into a definitive agreement to sell its global cleaners and disinfectants business to Kersia Group for $130 million in cash at closing, along with performance-based contingent consideration. The transaction, anticipated to close in the first quarter of the 2026 fiscal year, is subject to regulatory approval and customary closing conditions.
The cleaners and disinfectants division, generating around $60 million in annual revenue, is currently used in various livestock applications including swine, poultry, and ruminants operations. This strategic divestiture will enable Neogen to concentrate more on its core food safety diagnostics business, leveraging an expected margin-accretive outcome from the deal.
Proceeds from the sale will be utilized to fully repay the $100 million drawn on Neogen's revolving credit facility, reducing the company's net leverage ratio by approximately 0.4x on a pro forma basis. This financial maneuver strategically enhances Neogen's balance sheet, providing the company with greater financial flexibility moving forward.
Kersia Group aims to integrate the acquired business to strengthen its global biosecurity and hygiene solutions offering. The acquisition is anticipated to create synergies within Kersia's existing operations, allowing them to bolster their mission of ensuring food safety across the supply chain.
