Testing Firm Neogen Offloads Cleaners Division To Kersia In $130 Million Deal

Food safety solutions provider Neogen Corporation NEOG shares are trading higher on Monday after selling its Cleaners & Disinfectants Business.

The company has finalized an agreement to divest its worldwide cleaners and disinfectants division to Kersia Group, a leading company in hygiene and biosecurity solutions, in a cash transaction valued at $130 million.

The agreement includes additional contingent payments based on the business's future performance. The transaction, subject to regulatory approval, is expected to conclude in the first quarter of FY26.

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"The sale of our cleaners and disinfectants business further focuses Neogen on food safety diagnostics and continuing to build on our leadership position in what we believe is an attractive end market with long-term tailwinds," said President and CEO of Neogen, John Adent.

"We expect Kersia's prioritization of investment and growth in the biosecurity market will benefit the business and provide sharpened strategic focus to maximize its potential for continued growth."

Proceeds from the sale will enable Neogen to eliminate its $100 million revolving credit debt, following a recent refinancing move.

The company expects the transaction to improve profit margins and lower its net leverage ratio by roughly 0.4x on a pro forma basis.

Neogen's disinfectant and cleaning product line, which brings in about $60 million in yearly revenue, supports various livestock markets such as poultry, swine, and ruminants.

Price Action: NEOG shares traded higher by 7.14% at $4.71 at last check Monday.

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