Thu, Dec 18, 2014 12:21
HomeMost Recent NewsLone Star Business BlogContact Us
Advertise with Texas Business
Orthofix International Agrees to Sell Sports Medicine Business Unit For $157.5 Million

Texas Business reports: LEWISVILLE—Orthofix International NV reached an agreement under which Water Street Healthcare Partners, a strategic private equity firm focused on the health care industry, will acquire Orthofix's Sports Medicine Business Unit, which operates as Breg Inc.

The purchase price is $157.5 million and is payable in cash at closing, which is expected to occur during the second fiscal quarter of 2012.

Net proceeds to Orthofix from the sale are anticipated to be approximately $140 million, which will be used for the prepayment of debt as required by Orthofix's existing credit agreement.

The company acquired its Sports Medicine business in 2003 with the purchase of Breg, which is headquartered in Carlsbad, California. The sports medicine business provides a portfolio of bracing and cold therapy products to treat a variety of sports medicine related conditions.

“With the divestiture of the sports medicine business, we are now able to devote Orthofix's full resources and attention to strengthening our value proposition around our repair hardware and regenerative biologics and stimulation solutions,” said chief executive Robert Vaters in a prepared statement. “We believe this deleveraging event and resulting borrowing capacity will allow us to expand and enhance both our spine and orthopedic business units in a way that accelerates our ability to create shareholder value.”

“We are pleased that Orthofix has entrusted Water Street to grow Breg,” said Water Street partner Chris Sweeney in a statement. “We see tremendous opportunity to build on Breg's leadership position and create greater long-term value in the organization. We will leverage our team's deep medical products knowledge, extensive operating experience and network of relationships to strategically expand Breg's innovative products and global presence.”

Upon closing, the company will file the required pro forma financial results reflecting the disposition following the consummation of the sale transaction with the Securities and Exchange Commission, including any impact of pre-closing liabilities the Company will retain. J.P. Morgan Securities LLC provided a fairness opinion to the board of directors related to the transaction.