Blackstone and TPG Snap Up Hologic in $18.3 Billion Deal, Kicking Off a New Chapter in Healthcare Private Equity
Blackstone and TPG Snap Up Hologic in $18.3 Billion Deal, Kicking Off a New Chapter in Healthcare Private Equity
NEW YORK – Private equity heavyweights Blackstone and TPG have struck an $18.3 billion deal to take medical technology leader Hologic Inc. private, marking one of the biggest healthcare buyouts of the year. The move doesn’t just reward shareholders—it reignites private equity’s hunger for proven, cash-rich healthcare companies, even as the broader economy wobbles.
Under the agreement announced Tuesday, Hologic shareholders will pocket $76 in cash per share—a hefty 46% premium over the May 23 closing price. On top of that, they’ll receive a special bonus: a contingent value right worth up to $3 more per share, depending on how well Hologic’s Breast Health division performs in 2026 and 2027.
This deal isn’t just another line item in the M&A ledger—it signals a turning point. After taking a breather from the post-pandemic frenzy, private equity firms are now deploying their mountain of dry powder—over $1.5 trillion—into fewer but far larger transactions. Hologic, with its stronghold in women’s health, steady cash flows, and temporarily deflated stock price, fits perfectly into this new playbook of strategic consolidation.
Riding the Wave: Healthcare’s Megadeal Revival
Hologic’s buyout is more than a splash—it’s a tidal wave. Healthcare private equity transactions in the first half of 2025 hit nearly $100 billion, with the average medtech deal climbing 11% year-over-year to about $500 million. Investors are moving away from risky startups and toward established players that can ride out turbulence.
This “bigger is better” trend echoes across the board. Patient Square Capital’s $2.6 billion purchase of Premier Inc. and BayPine’s $1.5 billion acquisition of CenExel Clinical Research show the same pattern: buy strong companies, take them private, streamline, and grow.
“Hologic’s reliable growth and fat cash flow make it irresistible,” a Needham analyst remarked. At roughly 15 times its projected 2025 EBITDA, the deal’s price tag is steep for a company growing revenue just 5% a year—but its 33% gross margins and leadership in women’s health justify the premium. Backing from global giants like ADIA and GIC underscores the massive capital now flowing into these mega healthcare plays.
Why Hologic, and Why Now?
Hologic’s path to this moment wasn’t accidental. Its share price had fallen 24% this year before the announcement, dragged down by post-COVID declines. Revenue peaked at $5.6 billion in 2021 but slipped to around $4 billion as pandemic-related demand faded.
The company’s flagship Breast Health division also took a hit, with sales dropping 5–7% in 2025. Tariffs and softer screening demand compounded the pain. For investors with long-term vision, that slump created the perfect entry point.
“Hologic’s technology changes lives—it deserves the investment muscle to innovate faster,” said Blackstone’s Ram Jagannath. TPG’s John Schilling called it a classic “buy-and-build” play in a $584 billion medtech market ripe for expansion. For CEO Steve MacMillan, it’s a welcome shift: he gets to focus on innovation—like embedding AI into mammography systems—without the grind of quarterly earnings calls.
Private Ownership: Boon or Burden?
For shareholders, the deal offers instant gratification. The $76 per share payout locks in value after a rough year, while the CVR dangles a potential bonus if Breast Health rebounds. Analysts say there’s roughly a 30% chance of that full $3 payout—so it’s a nice cherry on top, but far from guaranteed.
Going private opens new doors for Hologic. Blackstone and TPG are expected to inject cash to streamline operations, invest in R&D, and prune non-core businesses. Their goal? Boost EBITDA by 10–15% before exiting in five to seven years.
Still, the playbook isn’t risk-free. Financing the deal will likely pile on $12–14 billion in debt. Servicing that burden could force deep cost cuts, which in healthcare can have uncomfortable consequences—job losses and potential risks to patient outcomes. Past studies link private equity ownership in hospitals to higher rates of patient harm, a shadow that follows any cost-driven transformation. And with Hologic controlling over half of the U.S. mammography market, regulators will be watching closely for antitrust issues.
If all goes to plan, the transaction will close in the first half of 2026. Its success—or failure—will likely shape how investors approach healthcare M&A for years to come, testing just how far private equity can go in balancing profit with patient well-being.
The Investor’s Angle: Making Sense of the Numbers
This section provides analysis based on public data and deal terms. It’s not financial advice.
For traders and arbitrage specialists, the Hologic buyout is both a puzzle and a potential payday. To understand the opportunity, it helps to break it down: the cash payment, the CVR kicker, and the risks in between.
At the time of writing, Hologic’s stock sits at $74.32—$1.68 below the deal’s $76 payout. Assuming the deal closes by mid-2026, that spread translates to an annualized return of roughly 3.4%. For risk-conscious investors, it’s a solid, low-drama play. With minimal regulatory hurdles, the base case looks clean.
But the CVR is where things get interesting. It’s not tradable and depends entirely on Breast Health hitting undisclosed revenue goals. Considering recent 5–10% revenue declines, those targets won’t be easy. Analysts peg the CVR’s fair value between $0.90 and $1.20, though the real number won’t be clear until regulatory filings reveal the actual benchmarks.
The main threats lie not in antitrust but in execution and financing. If debt markets wobble, spreads could widen, delaying the close and eating into returns. There’s also a 45-day “go-shop” window, giving other suitors a shot at a higher bid. While rivals like GE HealthCare or Siemens Healthineers are long shots due to antitrust concerns, another private equity group could surface, sparking a bidding war.
Savvy investors might play this by going long on Hologic while shorting a healthcare ETF such as IHI or XLV to hedge market risk. Think of the CVR as a call option—a speculative side bet on a Breast Health comeback—tacked onto a fundamentally steady merger trade.
Disclaimer: This article offers forward-looking insights based on public information. It’s not a buy or sell recommendation. Always consult a licensed financial advisor before making investment decisions.