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KCI taps new CEO, chairman
January 27, 2012

By Patrick Danner, San Antonio Express-News

Kinetic Concepts Inc.'s board on Friday promoted Joseph F. Woody to president and CEO two months after he joined the company as a division head.

Woody, 46, replaces Catherine Burzik, who stepped down from the San Antonio wound-care company this month after a little more than five years on the job.

Burzik's departure followed the November leveraged buyout of KCI by a group led by London-based private equity firm Apax Partners. The deal was valued at $6.1 billion.

Ronald Matricaria, meanwhile, has been named nonexecutive chairman, although a spokesman said Matricaria will take an active role in KCI's "strategic direction." Matricaria has been a director of Volcano Corp. in Rancho Cordova, Calif. He replaces Buddy Gumina, an Apax partner.

Simultaneously with the management changes, KCI announced it would pursue "strategic alternatives" for its therapeutic support systems business. That likely includes exploring a possible sale.

KCI also announced that its LifeCell business, which specializes in skin regeneration, will be managed independently from KCI, although their financial reporting will remain consolidated. Taking over as LifeCell's president and CEO is Lisa N. Colleran. She has been the global president of LifeCell Corp., which is based in New Jersey.

In a statement, KCI said the changes are "designed to strengthen the companies' performance and deliver stronger returns." A KCI spokesman had no comment. KCI and LifeCell combined have about 7,100 employees around the world, including about 2,000 in San Antonio.

The therapeutic support systems unit, which launched KCI about 35 years ago, sells and rents hospital beds, mattress-replacement systems and patient-mobility devices. The unit employs about 2,000 people, including 300 locally.

Credit Suisse has been hired as lead adviser, along with UBS Investment Bank, to explore options for the unit.

Just two years ago, KCI announced it would hang on to its therapeutic support systems unit despite its shrinking revenue. At the time, Burzik said KCI had "strong brand recognition" in the segment. She added that it was a "really, really good business" and that she wanted to find ways to start increasing sales.

Revenue continued to fall, however. In its last financial report before going private, KCI reported its therapeutic support services business posted revenue of $195 million for the nine months ended Oct. 31, down about 10 percent from sales of $217.5 million for the nine months ended Oct. 31, 2009.

Overall, KCI had revenue of about $2 billion in 2010.

Selling the unit could help KCI's new owners pay down some of the debt used to acquire the company.
KCI said in the statement it doesn't plan to report on developments in its "strategic alternatives review process" unless the board approves or completes a deal or decides further disclosure makes senses.

Woody, KCI's new president and CEO, joined the company in November as global president of its advanced wound healing business, known as active healing solutions.

Woody previously served as global president of vascular therapies at Covidien. He also has been global president of Smith & Nephew Advanced Wound Management.

Martin J. Landon, who has served as interim CEO, will continue as KCI's CFO.

 

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