Health Care Deal News: Spotlight on Medical Devices - January 2012

In December’s largest Medical Device deal, Fujifilm Holdings Corp. (T: 4901) is acquiring SonoSite (NASDAQ: SONO) for $995.0 million. SONO develops, manufactures, and distributes hand-carried ultrasound systems for use across medical specialties and in a range of treatment settings. Under terms of the deal, Fujifilm is offering $54.00 per share in cash, which offers SONO shareholders a 50% premium over the stock’s average closing price for the prior three-month period. Valued at 3.2x revenue, this acquisition complements Fujifilm’s imaging technologies with SONO’s point-of-care expertise and miniaturization capabilities. The deal also continues the buyer’s transition from an imaging company historically based on film to one based on digital technologies. Barclays Capital provided Fujifilm with financial advice while JP Morgan Securities and GCA Savvian Advisors provided SONO with similar advice.

CR Bard (NYSE: BCR) is acquiring Lutonix, a manufacturer of drug-coated angioplasty balloons, for approximately $325.0 million. Under terms of the deal, BCR will pay $225.0 million upfront and an additional $100.0 million predicated on Lutonix gaining certain regulatory approvals. This acquisition expands the range of angioplasty devices that BCR can offer its customers. Lutonix is conducting the first and only trials for a drug-coated percutaneous transluminal angioplasty balloon for the treatment of peripheral artery disease. The $100.0 million milestone payment noted above is payable when Lutonix achieves pre-market approval for its drug-coated balloons. The devices already have CE Mark approval for sale in Europe; BCR plans to begin sales there in the second half of 2012. The buyer is betting that approval in the U.S. is not far behind.

Baxter International (NYSE: BAX) is paying $28.00 per share in cash, or $325.0 million, to buy Synovis Life Technologies (NASDAQ: SYNO). Based in St. Paul, Minnesota, SYNO is a medical device company that develops soft-tissue repair products for use in surgery. The deal offers shareholders a 51% premium to the stock’s prior-day price. Valued at 4.2x revenue, this acquisition complements BAX’s regenerative medicine and surgery portfolio. SYNO’s devices target obesity, vascular surgery and hernia repair. Net of cash acquired, however, the deal is valued at about $260.0 million, or 3.3x revenue.

Symmetry Medical (NYSE: SMA) is buying the surgical instruments of Codman & Shurtleff, a unit of Johnson & Johnson (NYSE: JNJ), for approximately $165.0 million in cash. The acquisition of this unit, valued at 2.75x revenue, strengthens the buyer’s hospital direct business, Specialty Surgical. The newly acquired unit is to combined with Specialty Surgical and be renamed Symmetry Surgical. SMA will finance the deal through an amendment to its senior secured credit facility and the issuance of $65.0 million of senior subordinated notes. Stiefel Nicolaus Wiesel advised SMA on this deal...Want to read more? Click here for a free trial to The Health Care M&A Monthly and download the current issue today