The private equity firm Carlyle Group LP is considering either a sale or initial public offering of Ortho-Clinical Diagnostics Inc. The U.S. diagnostics company may be worth over $7 billion.

Carlyle acquired Ortho-Clinical Diagnostics from Johnson & Johnson back in 2014 for $4 billion. The sale or IPO demonstrates how a buyout firm can change an unwanted business into a profitable investment in a short matter of time.

Carlyle has already appointed investment banks to run the sale of Ortho-Clinical, according to sources familiar with the matter. Carlyle may also choose to engage in an IPO instead if the offers are not what they are looking for.

Both companies declined to comment.

New Jersey-based, Ortho-Clinical produces in-vitro diagnostics equipment and associated assays and reagents. It sells products in over 125 countries and has the potential to expand into new markets. The company brings in roughly $1.7 billion in revenue each year. Over the last few years, it has tacked on major debt to establish the view that it is a standalone company which is anticipated to dwindle off by the end of this year.

A deal for Ortho-Clinical would likely surface during the first two quarters of 2018. This makes Ortho-Clinical one of the first of Carlyle’s companies to be divested under Glenn Youngkin and Kewsong Lee. Both Youngkin and Lee are on target to become co-chief executive officers of to the company in January. They are taking over the roles from the company’s founders David Rubenstein, William Conway and Daniel D‘Aniello.


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Over this year, Carlyle has been seeking to take profits from healthcare companies it has invested in. Just in April, it agreed to sell a portion of its 60 percent venture in the U.S. clinical trials firm Pharmaceutical Product Development LLC which boasted a $9.05 billion corporate valuation.