Key Takeaways
- • Blackstone, Carlyle Group, and Hellman & Friedman acquire Medline Industries for $34 billion in the largest leveraged buyout in a decade, with the Mills family retaining significant ownership alongside the private equity sponsors and Singapore's GIC.
- • Medline generated $20.6 billion in revenue at the time of the LBO, positioning the medical supply distributor as a stable, cash-generative business with double-digit levered return potential despite slowing topline growth relative to public healthcare comps.
- • The transaction structure deviates from traditional LBO models, featuring minority PE ownership rather than full control—more aligned with large-cap PE strategies similar to the Thomson Reuters/Blackstone precedent, signaling a strategic shift toward mid-cap transactions with IPO optionality.
- • Medline subsequently returned to public markets in 2025 through a $6.26 billion IPO at $29 per share, becoming the largest US IPO since 2021 and generating significant returns for the sponsor consortium on a four-year hold.
- • Post-IPO valuation reached approximately $37-39 billion, with the company demonstrating 10.3% revenue growth and 34% EPS growth in 2025, while executing debt reduction from $16.8 billion to $12.8 billion.
Summary
On June 7, 2021, a consortium of three major private equity firms—Blackstone, Carlyle Group, and Hellman & Friedman—announced the acquisition of Medline Industries for $34 billion, marking the largest leveraged buyout of the decade. The Northfield, Illinois-based medical supply company, which supplies hospitals and healthcare providers with essential products including gloves, gowns, and examination equipment, represented a significant strategic deployment of capital during the post-pandemic dealmaking boom.
The transaction structure reflected an evolution in large-cap private equity strategy. Rather than the traditional fully-controlled LBO model, the sponsor group maintained minority ownership positions alongside the founding Mills family, which retained approximately 35% of the company. Singapore's Government Investment Corporation (GIC) committed $1 billion as a strategic co-investor, holding approximately 5% of the equity. This hybrid ownership approach—departing from conventional leveraged buyout architecture—indicated PE sponsors' strategic shift toward minority stakes in mid-market, high-quality cash-generative businesses with eventual IPO exit pathways.
At the time of acquisition, Medline demonstrated resilient fundamentals with $20.6 billion in annual revenue and established market leadership in medical supplies distribution. While topline growth had moderated compared to historical levels, the business remained highly cash-generative with the capability to service significant leverage and deliver double-digit levered returns to equity sponsors. The business model emphasized scale efficiency and customer loyalty, positioning it as a "Costco of healthcare" according to management strategy articulations.
The investment thesis proved successful. Four years post-acquisition, Medline returned to public markets in 2025 through a record-breaking $6.26 billion initial public offering—the largest US IPO since Rivian's 2021 listing. The IPO priced at $29 per share and subsequently traded above $40, valuing the company at approximately $37-39 billion post-IPO. Financial performance demonstrated the durability of the business: revenue reached $20.6 billion with net income of $977 million, accompanied by 10.3% revenue growth and exceptional 34% earnings-per-share growth in fiscal 2025, even amid macroeconomic headwinds. Management executed significant debt reduction, bringing total leverage from $16.8 billion to $12.8 billion, validating the sponsor group's cash deployment strategy and deleveraging execution.
The transaction structure reflected an evolution in large-cap private equity strategy. Rather than the traditional fully-controlled LBO model, the sponsor group maintained minority ownership positions alongside the founding Mills family, which retained approximately 35% of the company. Singapore's Government Investment Corporation (GIC) committed $1 billion as a strategic co-investor, holding approximately 5% of the equity. This hybrid ownership approach—departing from conventional leveraged buyout architecture—indicated PE sponsors' strategic shift toward minority stakes in mid-market, high-quality cash-generative businesses with eventual IPO exit pathways.
At the time of acquisition, Medline demonstrated resilient fundamentals with $20.6 billion in annual revenue and established market leadership in medical supplies distribution. While topline growth had moderated compared to historical levels, the business remained highly cash-generative with the capability to service significant leverage and deliver double-digit levered returns to equity sponsors. The business model emphasized scale efficiency and customer loyalty, positioning it as a "Costco of healthcare" according to management strategy articulations.
The investment thesis proved successful. Four years post-acquisition, Medline returned to public markets in 2025 through a record-breaking $6.26 billion initial public offering—the largest US IPO since Rivian's 2021 listing. The IPO priced at $29 per share and subsequently traded above $40, valuing the company at approximately $37-39 billion post-IPO. Financial performance demonstrated the durability of the business: revenue reached $20.6 billion with net income of $977 million, accompanied by 10.3% revenue growth and exceptional 34% earnings-per-share growth in fiscal 2025, even amid macroeconomic headwinds. Management executed significant debt reduction, bringing total leverage from $16.8 billion to $12.8 billion, validating the sponsor group's cash deployment strategy and deleveraging execution.
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