Nobel Biocare (VTX:NOBN, OTC:NBHGY) announced today that it agreed to a $2.14 billion (CHF 2 billion) buyout offer from Danaher (NYSE:DHR), a pact that will forge the largest dental implants company on the market.
Danaher is putting down straight cash for Nobel in a public tender offer of $18.29 (CHF 17.10) per share, a 28% premium over the stock’s average trading price prior to July 29, 2014, when rumors began circulating that the companies were in buyout talks.
The news took Nobel’s NOBN shares down a few pegs to close at CHF 17.05 (about $18.24) on the Swiss exchange, a drop of 5.8% on the day. That’s still a 39% increase over the last 6 months.
Nobel is to remain a standalone subsidiary with its headquarters in Switzerland, and Danaher plans to continue pouring money into the business. That could be good news for Nobel, which is still struggling to regain the momentum it lost during the 2008 financial crisis.
NOBN shares peaked at CFH 450 mid-2007 but began dwindling that year before taking a massive hit in the spring of 2008, when shares dove from CHF 232.50 to CHF 49.64 in about a week. The stock hasn’t traded above CHF 20 since mid-2010.
Nobel suffered something of a crisis of confidence as growing unemployment and waning consumer confidence weighed down the dental implants market, which includes many devices that insurance often refuses to cover. The industry is slated for a comeback, however, as markets and outlooks improve.
The company reported doubled profits in its 2nd quarter of 2014 on strong sales in the U.S. and Asia, boosting its full-year outlook for adjusted EBIT margin growth from 1.0% to 1.5%-2%, on sales growth of 3%-4%.
"Dental implants alone is a USD 3.5 billion market with attractive long term growth drivers, including an aging population, growing income in high growth markets and low penetration rates of dental implants in most geographies," the companies said. "With this acquisition, the Danaher dental platform will have a leading position in dental; and Danaher plans to further invest in this area."
Nobel’s board of directors voted unanimously, with one abstention, to accept the offer and the company is recommending that shareholders to the same. Danaher needs at least 67% Nobel’s shares tendered in order to seal the deal, according to the company statement.
