RTI Surgical Holdings, a global surgical implant company, is to sell the Company’s OEM business to Montagu Private Equity (Montagu), for a total consideration of USD490 million.
RTI Surgical Holdings, a global surgical implant company, is to sell the Company’s OEM business to Montagu Private Equity (Montagu), for a total consideration of USD490 million. The transaction is targeted to close in the first half of 2020.
“The sale of the OEM business to Montagu completes the first phase of our strategic transformation to reduce complexity, drive operational excellence and accelerate the growth of RTI Surgical,” said Camille Farhat, President and CEO, RTI Surgical Holdings. “We are excited about this transaction, not only because of the value that is immediately created, but also because the OEM business is going to an experienced investor who understands the business and the expertise of the people and will support its growth and development.
“Following the transaction, we believe RTI will be a global pure play spine company with tremendous fundamentals and exciting long-term growth prospects. We estimate the spine business will have generated global revenues in the range of USD118 million to USD119 million with gross margins of approximately 75 per cent in 2019. Immediately, post-transaction, the continuing business is expected to be debt-free and have approximately USD175 million to USD200 million of cash on the balance sheet to support its growth, which will be further driven by our Novel Therapies and an expected minimum of 10 new product introductions during each of the next two years.”
Olivier Visa, President of the OEM business, says: “We are thrilled about the sale of the OEM business to Montagu. We have built a world-class design, development and manufacturing competency with demonstrated expertise across tissue, biologics and hardware with a tremendous team and a customer base of leading medical technology companies. We are vested in continuing to build customer intimacy in service of our existing and future partners and continuing our legacy of serving more patients and maximising the gift of donation. We look forward to working with Montagu in driving the growth of the business and deepening the significant expertise and core competencies we have developed to serve more patients.”
Guillaume Jabalot, Director, Montagu, says: “As a strong, resilient business that is well-positioned to capitalise on accelerated growth opportunities, RTI’s OEM business is an excellent fit for Montagu’s investment strategy. We look forward to working with Olivier and the team to support the business in this exciting next chapter of growth, maintaining its ethos of exceptional service and innovation.”
Piper Sandler acted as the exclusive financial advisor and rendered a fairness opinion to RTI Surgical Holdings, and Sidley Austin and Holland & Knight were RTI Surgical Holdings’ legal advisors on the transaction. Weil, Gotshal & Manges LLP acted as legal advisors to Montagu.
