Zimmer Holdings Inc. and Biomet Inc., both of Warsaw, Ind., have approved a definitive agreement under which Zimmer will acquire Biomet in a cash and stock transaction valued at approximately $13.35 billion, including the assumption of net debt. The merger will position the combined company as a leader in the $45 billion musculoskeletal industry and is aligned with Zimmer’s strategic framework, which focuses on growth, operational excellence, and prudent capital allocation.
The combined company is expected to deliver attractive growth by offering a more comprehensive and scalable portfolio of solutions with enhanced cross-selling opportunities. In addition, the combined company is expected to advance innovation to benefit healthcare stakeholders, and stockholders are expected to benefit from a more diversified and predictable revenue mix consistent with the comprehensive portfolio.
Upon closing, the transaction is expected to be double-digit accretive to Zimmer’s adjusted diluted earnings per share in the first year. Cash flows from operations are expected to increase by 1.5 times Zimmer’s stand-alone estimates.
“This is a milestone combination that brings together two highly complementary organizations and is consistent with our mission to lead the industry in delivering value to healthcare providers, their patients and stockholders,” said David Dvorak, Zimmer President and CEO. “The transaction positions the combined company as a leader in the musculoskeletal industry with a broad portfolio of products, technologies and services, enabling us to help shape how solutions are developed and delivered.
According to Jeffrey R. Binder, Biomet’s President and Chief Executive Officer, “The combination with Zimmer will prepare us to compete as a stronger entity in the medical device industry of the future. Our combined scale will extend the reach and influence with which we pursue our common passion: delivering products and services that benefit our customers and the patients we ultimately serve.”
