Kendall Will Sell McGaw Unit for More Than $210 Million

An investor group headed by health-care executive James M. Sweeney said Friday that it has agreed to acquire McGaw Laboratories in Irvine for $210 million plus other, unspecified considerations.

Terms of the deal were not disclosed.

McGaw, owned by Boston-based Kendall Corp., is a major manufacturer of intravenous sets, nutritional and pharmacy products, and intravenous system pumps and controllers sold to hospitals and home health-care providers.

The company has 3,000 employees and posted 1989 sales of about $225 million, Kendall officials said.

Sweeney founded and served as chairman and chief executive of Caremark Corp., a Newport Beach-based home health-care firm that in 1987 was acquired by Baxter International Inc., a health-care conglomerate based in Deerfield, Ill.

When Sweeney resigned from Caremark in 1988--nine years after he started the company--he commented: “It’s like having a hit play on Broadway for nine years, and now I want to do something else.”

The investor group said its offer is fully financed, with backing from the investment firms Alex. Brown & Sons Inc. and Donaldson, Lufkin & Jenrette Securities Corp.

In a prepared statement, Kendall Chief Executive Richard A. Gilleland said McGaw no longer fits with Kendall’s business strategy.

“McGaw is an excellent business, and while it no longer fits with our current strategy, we are confident the company can flourish under the ownership of Mr. Sweeney’s group. His extensive experience in the hospital and home-care markets will serve McGaw, its customers and its 3,000 employees well,” he said.

Sweeney added: “For the first time in many years, McGaw will be an independently owned and operated company” with headquarters in Irvine.

McGaw is a former division of American Hospital Supply Corp., which sold McGaw in 1985 to Kendall in order to satisfy antitrust regulators who were reviewing American Hospital’s pending merger with Baxter Travenol Laboratories.