Plainsboro, N.J.-based Integra said it plans to finance the buyout with cash on hand, a credit revolver and a new term loan; BofA Merrill Lynch and JPMorgan are backing the deal, the company said. Codman Neuro put up sales of about $370 million last year, but Integra said it expects “some initial disruption” in the 1st year after closing, with growth established at 3% to 6% over the long term. The new business is forecast to add 22¢ to adjusted earnings per share in the 1st year, Integra said, noting its aim to get its overall sales to the $2 billion mark.
“This proposed transformational acquisition of Codman Neurosurgery creates compelling value for our shareholders, employees and patients,” president & CEO Peter Arduini said in prepared remarks. “Its innovative portfolio and global reach will enable us to enhance our position in the neurosurgery market, while also building a global infrastructure that will benefit Integra as a whole. We look forward to welcoming the more than 600 Codman Neurosurgery employees to the Integra team.”
The acquisition is expected to close in about 24 principal international jurisdictions during the 4th quarter and in the remaining nations “on a rolling basis after that, Integra said. BofA Merrill Lynch acted as financial advisor with Latham & Watkins as legal advisor, the company said.
IART shares closed up 1.0% at $43.28 apiece yesterday, when JNJ shares finished up 0.4% at $116.36 each before sliding -0.3% to $116 even.
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