TIDMSN.
RNS Number : 4691A
Smith & Nephew Plc
29 September 2020
Smith+Nephew expands in higher-growth extremities segment
through planned acquisition of Integra LifeSciences' Extremity
Orthopaedics business
29 September 2020
S mith+Nephew (LSE:SN, NYSE:SNN), the global medical technology
business, announces that it has agreed to acquire the Extremity
Orthopaedics business of Integra LifeSciences Holdings Corporation
(NASDAQ:IART) for $240 million. The acquisition supports
Smith+Nephew's strategy to invest in higher-growth segments.
This acquisition will significantly strengthen Smith+Nephew's
extremities business by adding a combination of a focused sales
channel, complementary shoulder replacement and upper and lower
extremities portfolio, and an exciting new product pipeline.
The focused extremities commercial channel includes a
specialised sales force and distributors, predominantly in the US
as well as Canada and Europe.
The portfolio is highly complementary to Smith+Nephew's existing
orthopaedics offering, in particular providing entry into the
shoulder replacement and foot and ankle segments. The full
portfolio includes devices, implants, and instruments which provide
for shoulder replacement as well as reconstruction of bone in the
hand, wrist and elbow (Upper Extremity) and foot and ankle (Lower
Extremity). The US extremities segment has been growing at around
6-7% per annum (1) .
The Extremity Orthopaedics R&D pipeline includes a
next-generation shoulder replacement system, which is expected to
be ready for full commercial launch in 2022.
Skip Kiil, President, Global Orthopaedics at Smith+Nephew,
said:
"Integra's Extremity Orthopaedics business is an established
global player in the rapidly growing extremities segment, including
total shoulder replacement, and has a well-regarded specialised
sales channel and a strong pipeline of new products. This strategic
acquisition represents a significant opportunity to strengthen
Smith+Nephew's position in a high-value area and allows us to offer
a leading extremities portfolio to customers."
Peter Ligotti, Senior Vice President, Extremity Orthopaedics,
Integra LifeSciences, said:
"We are looking forward to joining an organisation that is
committed to growing and expanding its orthopaedic product
portfolio. We are excited for the opportunities ahead as we
continue to advance orthopaedic innovations for our customers and
improve patient outcomes."
The business operates from facilities in Austin, Texas, which
includes a surgeon training facility, as well as in Lyon, France.
It is expected that around 300 employees will join Smith+Nephew on
completion.
Transaction details
The value of the transaction is $240 million which will be
financed from existing cash and debt facilities.
The business generated revenue of $90 million in 2019 and traded
at a small loss. The business is expected to deliver double-digit
revenue growth and be slightly dilutive to trading profit in 2021
and 2022. The Return on Invested Capital (ROIC) is expected to meet
or exceed our Weighted Average Cost of Capital (WACC) by the fifth
year.
The acquisition is expected to complete around the end of 2020,
subject to the satisfaction of customary conditions including
consultation with employee representative bodies.
Enquiries
Investors
Andrew Swift +44 (0) 1923 477433
Smith+Nephew
Media
Charles Reynolds +44 (0) 1923 477314
Smith+Nephew
Susan Gilchrist / Ayesha Bharmal +44 (0) 20 7404 5959
Brunswick
References
(1) Data from SmartTrak
About Smith+Nephew
Smith+Nephew is a portfolio medical technology business that
exists to restore people's bodies and their self-belief by using
technology to take the limits off living. We call this purpose
'Life Unlimited'. Our 17,500+ employees deliver this mission every
day, making a difference to patients' lives through the excellence
of our product portfolio, and the invention and application of new
technologies across our three global franchises of Orthopaedics,
Advanced Wound Management and Sports Medicine & ENT. Founded in
Hull, UK, in 1856, we now operate in more than 100 countries, and
generated annual sales of $5.1 billion in 2019. Smith+Nephew is a
constituent of the FTSE100 (LSE:SN, NYSE:SNN). The terms 'Group'
and 'Smith+Nephew' are used to refer to Smith & Nephew plc and
its consolidated subsidiaries, unless the context requires
otherwise.
For more information about Smith+Nephew, please visit
www.smith-nephew.com and follow us on Twitter , LinkedIn ,
Instagram or Facebook .
About Integra
Integra LifeSciences is a global leader in regenerative
technologies, neurosurgical and extremity orthopedic solutions
dedicated to limiting uncertainty for clinicians, so they can focus
on providing the best patient care. Integra offers a comprehensive
portfolio of high quality, leadership brands that include
AmnioExcel(R) , Bactiseal(R) , Cadence(R) , Certas(R) , Codman(R) ,
CUSA(R) , DuraGen(R) , DuraSeal(R) , ICP Express(R) , Integra(R) ,
MediHoney(R) , MicroFrance(R) , PriMatrix(R) , Salto Talaris(R) ,
SurgiMend(R) , TCC-EZ(R) , Titan(TM) and VersaTru(R) . For the
latest news and information about Integra and its products, please
visit www.integralife.com .
Forward-looking Statements
This document may contain forward-looking statements that may or
may not prove accurate. For example, statements regarding expected
revenue growth and trading margins, market trends and our product
pipeline are forward-looking statements. Phrases such as "aim",
"plan", "intend", "anticipate", "well-placed", "believe",
"estimate", "expect", "target", "consider" and similar expressions
are generally intended to identify forward-looking statements.
Forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause actual
results to differ materially from what is expressed or implied by
the statements. For Smith+Nephew, these factors include: risks
related to the impact of COVID-19, such as the depth and longevity
of its impact, government actions and other restrictive measures
taken in response, material delays and cancellations of elective
procedures, reduced procedure capacity at medical facilities,
restricted access for sales representatives to medical facilities,
or our ability to execute business continuity plans as a result of
COVID-19; economic and financial conditions in the markets we
serve, especially those affecting health care providers, payers and
customers (including, without limitation, as a result of COVID-19);
price levels for established and innovative medical devices;
developments in medical technology; regulatory approvals,
reimbursement decisions or other government actions; product
defects or recalls or other problems with quality management
systems or failure to comply with related regulations; litigation
relating to patent or other claims; legal compliance risks and
related investigative, remedial or enforcement actions; disruption
to our supply chain or operations or those of our suppliers
(including, without limitation, as a result of COVID-19);
competition for qualified personnel; strategic actions, including
acquisitions and dispositions, our success in performing due
diligence, valuing and integrating acquired businesses; disruption
that may result from transactions or other changes we make in our
business plans or organisation to adapt to market developments; and
numerous other matters that affect us or our markets, including
those of a political, economic, business, competitive or
reputational nature. Please refer to the documents that
Smith+Nephew has filed with the U.S. Securities and Exchange
Commission under the U.S. Securities Exchange Act of 1934, as
amended, including Smith+Nephew's most recent annual report on Form
20-F, for a discussion of certain of these factors. Any
forward-looking statement is based on information available to
Smith+Nephew as of the date of the statement. All written or oral
forward-looking statements attributable to Smith+Nephew are
qualified by this caution. Smith+Nephew does not undertake any
obligation to update or revise any forward-looking statement to
reflect any change in circumstances or in Smith+Nephew's
expectations.
Trademark of Smith+Nephew. Certain marks registered US Patent
and Trademark Office.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
ACQUKRURRAUKUAR
(END) Dow Jones Newswires
September 29, 2020 08:19 ET (12:19 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
Smith & Nephew (LSE:SN.)
Historical Stock Chart
From Mar 2024 to Apr 2024
Smith & Nephew (LSE:SN.)
Historical Stock Chart
From Apr 2023 to Apr 2024