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Tornier to Acquire OrthoHelix

Dutch orthopedic device company Tornier NV, which just appointed new Chief Financial Officer Shawn T. McCormick this past July, has now signed a definitive agreement to acquire OrthoHelix Surgical Designs Inc. The acquisition is valued at $135 million plus additional payments over two years, which will be based on achieving certain revenue growth milestones. Payment of the $135 millions will consist of $100 million in cash and $35 million in Tornier’s stock. Tornier intends to use cash on hand and borrowings to pay for the acquisition.

Based in Medina, Ohio, OrthoHelix is a medical device company developing a line of implants and instruments for use in small bone reconstructive surgery, including specialty implantable screw and plate systems for the repair of small bone fractures and deformities predominantly in the foot and ankle. OrthoHelix’s sales for the calendar year 2012, which are all based in the United States, are projected to reach approximately $29 million, an increase of more than 30 percent compared to 2011. OrthoHelix’s gross profit margin on 2012 sales is expected to exceed 80 percent and earnings before interest, taxes, depreciation and amortization is expected to be positive. The addition of OrthoHelix is expected to more than double Tornier’s lower extremity revenue and allow Tornier to increase its focus on foot and ankle surgeons.

“We are pleased to welcome the employees, surgeon advisors, and distribution partners of OrthoHelix to Tornier. OrthoHelix’s innovative technology, products, and surgeon focused culture will help us take our ‘specialists serving specialists’ strategy to the next level,” said Douglas W. Kohrs, president and CEO of Tornier. “The transaction will enable us to substantially expand our sales coverage of foot and ankle surgeons, significantly enhance our addressable lower extremity market opportunity, and position us to achieve more consistent growth across our upper and lower extremity product categories.”

OrthoHelix’s flagship product line is the MaxLock Extreme small bone screw and plate systems featuring proprietary anatomic contouring, low profile, and multiplanar fixation. The hope is that the combination of the Maxlock line with Tornier’s ankle arthroplasty, biologics, and other foot and ankle implants will create one of broadest offerings for lower extremity surgical specialists in the orthopedic industry. Tornier intends to channel OrthoHelix’s products through its own already-established international sales presence.

“We are very excited by the opportunities that the OrthoHelix and Tornier combination will present to our surgeon customers and our employees, said Dennis Stripe, president and CEO of OrthoHelix. “We believe Tornier’s resources will position us to drive significant organic growth in the lower extremity business through product innovation, access to novel arthroplasty and biologic products, and, over time, an international presence for OrthoHelix through Tornier’s strong proven distribution network. We are confident that our strong ‘surgeons speak—we deliver’ culture will only be enhanced as part of Tornier.”

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