Medtronic plc (NYSE:MDT), a global leader in medical technology, and Medicrea (Euronext Growth Paris: FR0004178572 – ALMED Medicrea; OTCQX Best Market – MRNTF), a pioneer in the transformation of spinal surgery through artificial intelligence, predictive modeling and patient specific implants, today announced that they have entered into a tender offer agreement for the acquisition of all outstanding shares of Medicrea. The friendly voluntary all-cash tender offer will be at a price of €7.00 per Medicrea share (the “Tender Offer”). The Boards of Directors of both companies have unanimously approved the transaction.
This acquisition would strengthen Medtronic’s position as a global innovator in enabling technologies and solutions for spine surgery.
“Combining Medtronic’s innovative portfolio of spine implants, robotics, navigation, and 3D imaging technology with Medicrea’s capabilities and solutions in data analytics, artificial intelligence and personalized implants, would enhance Medtronic’s fully-integrated procedural solution for surgical planning and delivery. This marks another important step in furthering our commitment to improving outcomes in spine care,” said Jacob Paul, senior vice president and president of the Cranial & Spinal Technologies division, which is part of the Restorative Therapies Group at Medtronic. “Medtronic will become the first company to be able to offer an integrated solution including artificial intelligence driven surgical planning, personalized spinal implants and robotic assisted surgical delivery, which will significantly benefit our customers and their patients.”
Medicrea’s product portfolio includes MEDICREA® UNiD® ASI (Adaptive Spine Intelligence) designed to support surgeon workflow in pre-operative planning and create personalized implant solutions for surgery. The Medicrea solution is powered by predictive modeling and sophisticated algorithms that measure and digitally reconstruct the spine to its optimal profile.
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“Spine surgery is one of the more complex procedures in healthcare because of the high number of different parameters to take into consideration. It is impossible for the human brain to compute all of them for one single patient,” said Denys Sournac, founder, chairman and CEO of Medicrea. “The medical world has been waiting for the arrival of customization in spinal surgery. With scientific progress in understanding sagittal balance and spinal injury, combined with the advent of new digital technologies, it is now possible to offer spinal patients entirely customized implants. We are thrilled to be joining forces with Medtronic because we share a similar mission to restore the long-term quality of life for patients. Now, together, we can help more patients in more places benefit from consistently high-quality surgical care.”
Key Terms of the Transaction
The Tender Offer price of €7.00 per share represents a premium of:
- 22% over the closing price of Medicrea shares on 14 July 2020
- 33% over the 1-month volume weighted average price of Medicrea shares as of 14 July 2020
- 56% over the 3-month volume weighted average price of Medicrea shares as of 14 July 2020
The Tender Offer will target all the outstanding shares of Medicrea as well as the shares to be issued upon exercise of the warrants subject to their exercise prior to the closing of the Tender Offer.
Medicrea’s largest shareholders, including founder, president and CEO Denys Sournac as well as certain other key managers, employees and directors of Medicrea, have entered into commitments to tender their shares (including shares to be issued upon exercise of warrants, but excluding, in the case of Denys Sournac and managers, free shares under lock-up period) in the Tender Offer.
These commitments remain revocable in case of a higher competing public tender offer in accordance with applicable French financial markets regulations.
With the above-mentioned commitments to tender, Medtronic has entered into agreements with Medicrea shareholders totalling approximatively 44.4% of Medicrea’s current outstanding share capital (adjusted for new shares to be issued upon exercise of warrants).
The transaction is subject to customary closing conditions, including obtaining regulatory clearance from the French Markets Authority (the “AMF”), applicable foreign investment clearance in France, and applicable merger control clearance in the United States.
The completion of the Tender Offer will be subject, in addition to the mandatory minimum acceptance condition set out in Article 231-9, I 1° of the AMF Regulation, to a minimum acceptance condition that Medtronic obtains a number of Medicrea shares representing at least 66.67% of the share capital and voting rights.
The Board of Medicrea will issue in due course a reasoned opinion on the merits of the Tender Offer for Medicrea, its shareholders and its employees following receipt of the fairness opinion issued by the independent expert appointed in accordance with Article 261-1, I & III of the AMF Regulation by the ad hoc committee to be created by the Board of Medicrea.
It is expected that the Tender Offer will be filed with the AMF in September 2020. The Tender Offer will be opened once the foreign investment approval in France is obtained, and the Tender Offer would still remain subject to the merger control clearance in the United States.
Assuming receipt of regulatory and other clearances and satisfaction of other closing conditions, the acquisition is expected to close by the end of calendar year 2020. The transaction is expected to be immaterial to Medtronic’s adjusted earnings per share in the first two fiscal years before turning accretive in fiscal year 2023. In addition, it is expected to meet Medtronic’s long-term financial metrics for acquisitions.
Source: Biospace