Warsaw-based Zimmer Biomet Holdings Inc. (NYSE: ZBH) has detailed plans to acquire a Texas-based medical device company in a $1 billion deal. During a presentation Tuesday morning to investors, Chief Executive Officer David Dvorak said the addition of LDR Holding Corp. (Nasdaq: LDRH) will bolster the company’s position as a leader in cervical disc replacement, which it says is the fastest growing segment in the $10 billion spine industry.
Dvorak says the deal is "fundamentally a growth story." Spine, CMF and Thoracic, and Dental Group President Adam Johnson will lead the combined operation. He calls the merger highly-complimentary, saying there will be "minimal" overlap of existing products.
Last month, Zimmer Biomet completed the acquisition of Arizona-based sports medicine device maker, Cayenne Medical Inc. In March, it also wrapped up the acquisition of Ortho Transmission Inc., which was headquartered in Colorado.
Officials say Zimmer Biomet continues to be on-track with transition efforts following its $13 billion mega-merger that was announced in 2014 and completed last year. The combination of the long-time Kosciusko County orthopedic institutions is expected to save some $270 million annually by the third year after closing.
Zimmer Biomet will launch a team to lead the transition of LDR, which will maintain a "significant" presence at its existing facilities in France, Colorado and Texas. The deal is expected to close in the third quarter and company officials expect it to drive overall growth for the company.
Christophe Lavigne, co-founder, chairman, president and CEO of LDR says he has "long admired" Zimmer Biomet. He will stay on with the combined company and says nearly 20 percent of LDR’s business is overseas. Lavigne and other executives believe the CMF market is poised for major growth in the coming years.
A slideshow from Zimmer Biomet provides details about the deal:
Dvorak says the deal is “fundamentally a growth story.”