Smith & Nephew Acquires OBI
Smith & Nephew’s Endoscopy division announced today its acquisition of privately-held, San Antonio-based OsteoBiologics, Inc. (OBI). OBI markets bioabsorbable bone graft substitutes (BGS) in Europe to repair cartilage defects in the knee, and offers the TruFitTM BGS Plugs in the U.S. as a bone void filler. Among other things Smith & Nephew sees potential for sports medicine and is doing the acquisition to complement its arthroscopy portfolio.
Smith & Nephew has agreed to pay a net consideration of $72.3M in cash for OBI or almost 22 times 2005 sales which amounted to $3.3 million. The acquisition is expected to reduce earnings by $7M in the second half of 2006 and be broadly neutral in 2007. According to Express News OsteoBiologics has 44 employees who are expected to stay in Texas. It was backed by venture capitalists who had invested $15.2M into it since 2003.
July 11, 2006 Related topics: Mergers & Acquisitions, Surgery, Orthopedic