Smith & Nephew agrees $1.7bn deal for joints specialist Arthrocare
Global medical technology business Smith & Nephew has announced an agreement to buy Arthrocare for $1.7bn.
The British-based company will acquire the US medical devices company for a total consideration of $1.7bn and an enterprise value of $1.5bn. It’ll pay $48.25 per Arthrocare share in cash.
Smith & Nephew said Anrthrocare’s shoulder anchor innovation technology will strongly complement its in knee repair, “forming an extensive, integrated portfolio”.
The firm expected the deal to add around $85m to annual trading profit in the third full year.
One-off transaction expenses and integration costs are expected to be around $100m, incurred over a three year period.
The deal will increase opportunities to cross-sell in established markets, along with supporting expansion into new and emerging markets and maximising efficiencies across the combined business, says the firm.
The purchase will be financed from Smith & Nephew’s debt facilities and cash balances, including an existing $1bn revolving credit facility and a new two-year $1.4bn term loan facility.