Sept 5 (Reuters) - Medical device maker Teleflex Inc said on Tuesday it would buy privately held NeoTract Inc to strengthen its portfolio of urology devices in its second billion-dollar deal in the past nine months.
Teleflex, whose devices are used in cardiac, respiratory and emergency care, said it would buy NeoTract in a deal whose value could rise to $1.1 billion based on the NeoTract's sales, including those of its flagship device, UroLift System.
The UroLift System is a minimally invasive device to treat men with lower urinary tract disorders due an enlarged prostate. A second-generation UroLift System in due in the second half of 2018.
NeoTract targets a market that is worth more than $30 billion and the company has clocked revenue growth of 20 percent or more in 13 of the past 14 quarters, Teleflex said.
The company's revenue is expected to be between $115 million and $120 million this year, compared with about $51 million in 2016, and is estimated to increase at least 40 percent in 2018, the companies said.
That rate of growth will help Teleflex increase its revenue in the mid-single digit percentage range for the next several years, as well as boost its margin profile, the company said.
Teleflex's revenue increased 3.2 percent in 2016 and is currently estimated to rise about 12 percent this year, mainly due to its deal to buy Vascular Solutions Inc, before tapering off to 3.2 percent growth by 2020, according to Thomson Reuters I/B/E/S.
Teleflex bought Vascular Solutions for about $1 billion in December to bolster its coronary and vascular business. That deal closed in February.
Teleflex said it would pay NeoTract $725 million when the deal closes, expected within the next 30 days, and an additional $375 million when it hits certain sales milestones through 2020.
The deal is expected to slightly dilute Teleflex's adjusted earnings per share this year, be neutral to profits next year and add 35-40 cents from 2019, the companies said.
Teleflex's shares closed at $210.51 on Friday, having gained about 31 percent in 2017.
Guggenheim Securities is Teleflex's financial adviser and Simpson Thacher & Bartlett LLP its legal adviser.
J.P. Morgan Securities LLC is advising NeoTract and Wilson Sonsini Goodrich & Rosati is its legal counsel. (Reporting by Divya Grover in Bengaluru; Editing by Savio D'Souza)