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LANSING, Mich. - Neogen Corporation (NASDAQ: NEOG), a company specializing in food safety solutions with a current market capitalization of $953 million, has entered into an agreement to sell its cleaners and disinfectants division to Kersia Group, a firm focused on biosecurity and hygiene. The deal, valued at $130 million plus additional future performance-based payments, is anticipated to finalize in the first quarter of Neogen’s 2026 fiscal year pending regulatory approval. According to InvestingPro analysis, the stock currently appears undervalued, with 13 key insights available to subscribers.
The transaction is expected to improve Neogen’s profit margins and will allow the company to repay $100 million from its revolving credit facility incurred during recent refinancing. This divestiture will also decrease Neogen’s net leverage ratio by an estimated 0.4x pro forma. InvestingPro data shows the company currently operates with a total debt of $894 million and a debt-to-equity ratio of 0.34, making this debt reduction particularly significant for its financial health.
John Adent, Neogen’s President and CEO, stated that the sale will allow the company to concentrate on its core business of food safety diagnostics. Adent assured a smooth transition for customers, employees, and stakeholders, and expressed confidence that Kersia’s focus on the biosecurity market will drive further growth for the cleaners and disinfectants business.
The business being sold generates about $60 million in annual revenue and has a worldwide presence. Its products are designed for high-quality cleaning and disinfecting, serving various livestock sectors such as swine, poultry, and ruminants.
Sébastien Bossard, CEO of Kersia, welcomed the acquisition, emphasizing the strategic fit of Neogen’s product range with Kersia’s existing solutions. He highlighted the importance of integrating Neogen’s expertise to enhance Kersia’s service offerings in the United States and internationally.
Neogen Corporation is known for its contributions to global food security and animal well-being, operating in over 140 countries. Kersia, with a presence in more than 120 countries and a workforce of over 3,000, is dedicated to advancing food safety at all stages of the food supply chain.
The information in this article is based on a press release statement. For deeper insights into Neogen’s financial health and future prospects, InvestingPro subscribers can access comprehensive analysis, including detailed valuation metrics, analyst forecasts, and a full research report. InvestingPro analysts expect the company to return to profitability this year, with projected earnings per share of $0.38 for fiscal year 2025.
In other recent news, Neogen Corporation reported its fiscal Q3 2025 earnings, revealing an unexpected rise in earnings per share (EPS) to $0.10, surpassing the forecast of -$0.01. However, the company faced a revenue shortfall, posting $221 million against the expected $232.36 million. Despite the EPS beat, the company revised its revenue and EBITDA guidance downward, indicating ongoing financial challenges. Guggenheim analysts responded by lowering Neogen’s stock price target from $15.00 to $13.00, though they maintained a Buy rating, suggesting confidence in the company’s long-term potential. Neogen’s sample collection business showed progress, and the Petrifilm product line is set to begin production in the fall. The company is actively restructuring its genomics business and managing costs to align with current market conditions. Neogen’s CEO, John Audent, highlighted the company’s focus on strategic realignment and improved execution amid macroeconomic uncertainties. Analysts noted the challenges posed by tariffs and softening market conditions, particularly in the US and Canada.
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