Zimmer Biomet (NYSE:ZBH) said today that it expects to close its $1 billion acquisition of LDR Holding (NSDQ:LDRH) later today, after its $37-per-share tender offer reaped about 88.9% of LDR’s outstanding shares.
The deal, which last month cleared the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, isn’t expected to affect Zimmer Biomet’s sales outlook, with adjusted earnings per share likewise unaffected until accretion kicks in after 2017. The company has said it plans to issue updated guidance once the acquisition closes.
LDR, which makes the Mobi-C cervical disc replacement and Mivo lumbar and cervical fusion devices, is slated to be folded into Zimmer Biomet’s spine & CMF business, led by president Adam Johnson. LDR CEO Christophe Lavigne and LDR co-founder and GM Patrick Richard will remain with the company in “key leadership positions” within the spine biz, Warsaw, Ind.-based ZBH said when the LDR deal was announced.
Zimmer Biomet said it’s financing the buyout with cash and a revolving credit facility; a senior notes offering worth $750 million is also in the offing.
“We are excited to officially welcome LDR to the Zimmer Biomet family. Together with LDR, Zimmer Biomet will be a leader in the $10 billion global spine market and well-positioned in the fast growing cervical disc replacement segment. Importantly, this combination is consistent with our goal of driving meaningful growth across all musculoskeletal markets with innovative products, technologies and services that enhance patient outcomes,” president & CEO David Dvorak said in prepared remarks.
Zimmer Biomet said it plans to keep LDR’s headquarters in Broomfield, Colo., plus “a significant presence” in Austin, Texas, and Troyes, France.
Goldman, Sachs advised Zimmer Biomet, with White & Case as legal advisor.
In March, Zimmer Biomet said it closed its buyout of Cayenne Medical and its soft tissue reconstruction devices for an unspecified amount. Scottsdale, Ariz.-based Cayenne makes devices for knee and shoulder repair, including the AperFix II, CrossFix II and iFix knee ligament reconstruction and meniscal repair devices and the Quattro device for rotator cuff and labral repairs. Cayenne buried the hatchet with rival MedShape last week after a review board found the terms of its soft tissue anchor patent to be “indefinite.”
In June Zimmer Biomet closed its acquisition of Compression Therapy Products, also for an undisclosed amount.