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CONMED announced a definitive agreement to acquire privately-held In2Bones Global for cash consideration of $145 million at closing and up to an additional $110 million in growth-based earnout payments over a four-year period.
The transaction is expected to close late in 2Q22 or early 3Q22.
In2Bones had 2021 revenue of $36.8 million at approximately 80% gross margins and is expected to grow revenue double digits on an ongoing basis. Based on the anticipated date of closing, CONMED expects the acquisition to add approximately $20 million to its revenue in 2H22. The acquisition is expected to be slightly accretive to adjusted EBITDA in 2022, accretive in the single-digit millions in 2023, and in the double-digit millions thereafter. From an adjusted EPS perspective, the acquisition is expected to be between $0.05 and $0.10 dilutive to both the remainder of 2022 and the full year 2023, and accretive thereafter.
Headquartered in Memphis, Tennessee, In2Bones is a global developer, manufacturer and distributor of medical devices for the treatment of disorders and injuries of the upper (hand, wrist, elbow) and lower (foot and ankle) extremities. The company’s product portfolio includes implants, fracture systems, biologics and related hardware.
“This acquisition is a natural strategic extension of our Orthopedic portfolio,” said Curt R. Hartman, CONMED’s Chair of the Board, President, and Chief Executive Officer. “In2Bones is an exciting platform for CONMED to enter the extremities market given its broad portfolio, extensive sales channel, and experienced leadership team. We look forward to welcoming the In2Bones team to CONMED.”
Mr. Hartman also said, “From an organizational standpoint, the business will run as a full platform stand-alone in the U.S. market and will retain the current organizational structure, including the existing sales channel. Outside of the U.S., the products will be picked up commercially by our international team in areas where there is no existing coverage or where the existing coverage is not as comprehensive as we believe is needed. As with our current global orthopedics effort, this business will report directly to Pat Beyer, our President of International and Global Orthopedics. We believe the CONMED platform will allow us to expand areas such as medical education and engineering, human resources and accounting services as well as the previously mentioned international market expansion, to name a few.”
Alan Taylor, President and Chief Executive Officer of In2Bones, added, “Our talented team has worked tirelessly to build a comprehensive and efficient set of solutions focused on successful reproducible outcomes for extremities surgery, and we are excited to join CONMED. The CONMED team clearly shares our focus on people and clinical innovation to address unmet needs, and we look forward to continuing to advance our solutions and deliver them to patients across the globe.”
“Alan and his team have built a strong global platform in the extremities market,” commented Pat Beyer, CONMED’s President of International and Global Orthopedics. “In2Bones is a strong complement to our existing international platform, and I am excited to expand our global orthopedic offering into the high-growth extremities space. I look forward to working closely with the In2Bones team and to integrating their portfolio and commercial team into our existing infrastructure.”
Source: CONMED Corporation
