Bloomington-based medical device maker Cook Medical plans to sell its reproductive health business to California-based rival Cooper Companies for $875 million.

Cooper’s investors reacted positively to Monday's announcement, sending the company’s share price up nearly 4% in early trading Tuesday. The S&P 500 was up 0.55%.

Cook can't fill jobs: Some production will move to Mexico, U.S. sites

The companies have signed a letter of intent on the deal. Cooper said it expects the transaction to close in the second quarter of this year.

Cook, which is privately held, declined a request from The Herald-Times to make a company representative available for an interview and did not immediately reply to emailed questions.

The company did not say why it is selling that division of its business or how many employees work in it.

Cook will continue production for unit during transition

Cook said in a news release that the reproductive health unit has employees in Spencer as well as in Pennsylvania and Australia. The company said Cook will continue to make products for Cooper during a two-year transition period and plans to “increase manufacturing capacity to keep up with growth.”

“Employees in manufacturing who support these products will continue to do so during the transition period and eventually will cross train to manufacture other Cook Medical products,” the company said.

The reproductive health unit has developed products for obstetrics and gynecology, in vitro fertilization and assisted reproductive technology over the past 40-plus years, the release said.

Cooper, which is publicly traded, said in a news release that Cook’s reproductive health business generated $158 million in revenue last year, which was up 17% from the prior year.

“This acquisition is an excellent strategic fit for CooperSurgical,” said Al White, president and CEO of the San Ramon, California-based company.

Deal will benefit CooperSurgical's international reach

He said the deal would improve Cooper’s international reach, especially in the Asia-Pacific region, and add “respected” devices to the company’s product lineup.

More: Why Cook is moving some work to other states, Ireland, and Mexico

Under the terms of the deal, Cooper would pay Cook $675 million once the transaction is finalized and another $200 million in $50 million installments over the next four years.

Cook Group and Cook Medical President Pete Yonkman said in the news release that the sale would allow Cook “to invest in future growth and new technologies,” though the company did not provide details.

Boris Ladwig is the city government reporter for The Herald-Times. Contact him at bladwig@heraldt.com.

This article originally appeared on The Herald-Times: Cook Medical to sell business unit to rival Cooper Companies for $875M