Zimmer Makes Pair of Acquisitions

Zimmer Holdings Inc. claims the position as the largest provider of reconstructive orthopedic devices in China. The Warsaw, Ind.-based firm has acquired Beijing Montagne Medical Device Co. Ltd. in an effort to expand its footprint in the growing Asian implant market.

Montagne’s product lines will provide an expanded product line in hips, knees and powered surgical instruments that are “tailored to the Chinese market,” according to an announcement from Zimmer. “We want to create products that address the unique needs of the Chinese market. Montagne will provide us access to additional research, development, and manufacturing capabilities that will allow us to achieve this goal,” said Stephen Ooi, president of Zimmer’s Asia Pacific division.

Montagne has two plants, one in Beijing and one in Xianning, Hubei—both of which are certified to ISO 13485:2003 and ISO 9000:2001 quality standards. The company employs 360 people, according to its website.

Zimmer’s sales in the Asia Pacific market steadily have been rising over the last several years, going from an annual total of $469 million in 2005 to $604 million last year (the region’s 2009 proceeds accounted for 15 percent of the $4.1 billion in sales Zimmer reported). Countries within the Asia Pacific market include Australia, China, India, Japan, Korea, Malaysia, New Zealand, Singapore, Taiwan and Thailand. (Hong Kong also is considered part of the Asia Pacific market even though it technically is a city).

The sales surge continued in the third quarter of 2010, with Zimmer reporting increases in the region’s overall sales as well as those of artificial hips, knees and extremities. Asia Pacific sales amounted to $166 million, a 12 percent jump compared with the $148.7 million the region amassed for the company in the third quarter of 2009. Knee sales rose 9 percent, going from $57.3 million in the third quarter of 2009 to $62.2 million in the same period this year. Hip sales swelled 12 percent, going from $50.7 million in Q3 of 2009 to $56.9 million in 2010, while sales of extremities soared 18 percent, going from $2 million in Q3 of 2009 to $2.4 million this year.

Just days after the announcement about China, the company finalized a deal for Sodem Diffusion S.A., the manufacturer of SoPlus Orthopaedic Surgical Power Tools based in Geneva, Switzerland.The company will be re-named Zimmer Surgical, S.A. and will be part of Zimmer Surgical, headquartered in Dover, Ohio.Deal details were not disclosed.

“Adding SoPlus’s innovative small and large bone product lines to our portfolio will expand our offerings in the orthopaedic power equipment market,” said Mark Dorris, President, Zimmer Surgical.

This acquisition will broaden Zimmer’s portfolio of surgical power tools and strengthen the company’s position in the more than $1 billion surgical power tool market. Sodem Diffusion’s portfolio includes the commercially available SoPlus Universal large bone system and the SoPlus Ultra small bone system with associated consumables.