Wright Medical Group N.V. Announces Acquisition of IMASCAP SAS
Ensures Exclusive Access to Breakthrough Software Enabling Technology to Further Differentiate Wright’s Product Portfolio and Further Accelerate Growth Opportunities in Wright’s Global Extremities Business
Purchase Price of €75.1 Million, or Approximately
Company Reiterates Previously Provided 2017 Annual Financial Guidance
Under the terms of the agreement with IMASCAP, Wright acquired 100% of IMASCAP’s outstanding equity on a fully diluted basis for total consideration, net of acquired cash, of €75.1 million or approximately
IMASCAP’s Glenosys technology is the preoperative planning software behind Wright’s BLUEPRINT™ 3D planning software, which allows the surgeon to simulate the position of a shoulder prosthesis using CT image data. The surgeon is able to visualize the shoulder in 3D and rotate through the complete range of motion in any direction. Before the surgery, the surgeon can optimize the surgical plan adapted to the patient to choose the best implant from a range of possibilities. With its simple and intuitive interface, this virtual surgical plan is seamlessly translated into the operating room on the day of surgery offering the potential for reduced surgical time, better outcomes and less inventory.
Palmisano continued, “While our BLUEPRINT planning software is a significant differentiator today, IMASCAP has a rich pipeline of potential breakthrough technologies under development and patent-pending. We believe the future of orthopaedic implant surgery will include advanced elements of artificial intelligence and augmented reality. When fully developed, we believe such software enabled surgery will leapfrog the current mechanical approaches some orthopaedic companies have developed primarily for hip and knee replacement surgery.”
Palmisano further commented, “IMASCAP is led by its founder and CEO,
IMASCAP has no revenues; therefore, there is no impact to Wright’s previously provided full-year 2017 annual net sales guidance of
For more information on this transaction, please refer to the investor presentation that is available in the Investor Relations section of Wright’s website at www.wright.com.
Internet Posting of Information
Wright routinely posts information that may be important to investors in the “Investor Relations” section of its website at www.wright.com. The company encourages investors and potential investors to consult the Wright website regularly for important information about Wright.
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About IMASCAP SAS
IMASCAP SAS develops software for preoperative planning of shoulder replacement surgery. IMASCAP software system is the only system in the world allowing orthopaedic surgeons complete independence for planning, with nothing more than image data provided by CT scan of the patient. The software allows the surgeon to automatically conceive a surgical guide adapted particularly to the patient anatomy, which permits the surgeon to implant the prosthesis in a position that closely matched the software plan. The system has been developed in close collaboration with internationally recognized experts in the shoulder field, providing an innovative and practical solution to the operating room. IMASCAP is focused on applying its technical expertise to serve orthopaedic surgery by furnishing patient specific solutions and participating in the development of new generations of prostheses adapting this new and innovative technology. For more information please visit www.imascap.com.
Non-GAAP Financial Measures
To supplement the company’s consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles, the company uses certain non-GAAP financial measures in this release, including . EBITDA, as adjusted, from continuing operations. The company's non-GAAP adjusted EBITDA from continuing operations target is measured by adding back to net loss from continuing operations charges for interest, income taxes, depreciation and amortization expenses, non-cash share-based compensation expense and non-operating income and expense. Additionally, the company’s adjusted EBITDA from continuing operations target excludes possible future acquisitions; other material future business developments; and due diligence, transaction and transition costs associated with acquisitions and divestitures. Further, this adjusted EBITDA from continuing operations target excludes any expenses, earnings or losses related to the divested large joints business, legacy Wright’s divested OrthoRecon business and legacy Tornier’s divested ankle replacement and silastic toe products. The company's management believes that the presentation of non-GAAP financial measures provides useful information to investors. These measures may assist investors in evaluating the company's operations, period over period. Wright’s non-GAAP financial measures exclude such items as non-cash interest expense related to the company's 2017 convertible notes, 2020 convertible notes and 2021 convertible notes, net gains and losses on mark-to-market adjustments on and settlements of derivative assets and liabilities, write-off of unamortized debt discount and deferred financing charges following the partial settlement of 2017 convertible notes and 2020 convertible notes, mark-to-market adjustments on CVRs, transaction and transition costs and tax impacts from changes in the realizability of net operating losses, all of which may be highly variable, difficult to predict and of a size that could have substantial impact on the company's reported results of operations for a period. It is for this reason that the company cannot provide without unreasonable effort a quantitative reconciliation to the most directly comparable GAAP measures for its 2017 financial guidance regarding non-GAAP adjusted EBITDA from continuing operations. Management uses the non-GAAP measures in this release internally for evaluation of the performance of the business, including the allocation of resources and the evaluation of results relative to employee performance compensation targets. Investors should consider non-GAAP financial measures only as a supplement to, not as a substitute for or as superior to, measures of financial performance prepared in accordance with GAAP.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This release includes forward-looking statements under the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by the use of words such as “anticipate,” “expect,” “intend,” “could,” “may,” “will,” “believe,” “look forward,” “continue,” “guidance,” “future,” other words of similar meaning and the use of future dates. Forward-looking statements in this release include, but are not limited to, statements about the future anticipated success and benefits of the company’s software-based solutions for preoperative planning of shoulder replacement surgery and the company’s anticipated financial results for 2017, including net sales from continuing operations and adjusted EBITDA from continuing operations. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Each forward-looking statement contained in this release is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statement. Applicable risks and uncertainties include, among others, the failure to realize the full anticipated benefits of the company’s software-based solutions for preoperative planning of shoulder replacement surgery; risks involved in the acquisition of IMASCAP and the anticipated registration of the resale of the Wright ordinary shares issued in connection therewith; failure to integrate the legacy Wright and Tornier businesses and realize net sales synergies and cost savings from the merger with Tornier or delay in realization thereof; operating costs and business disruption as a result of the merger, including adverse effects on employee retention and sales force productivity and on business relationships with third parties; integration costs; actual or contingent liabilities; failure of the company’s recent U.S. sales force additions, focus on core product portfolio and incentives to drive U.S. lower extremities and biologics sales or delay in realization thereof; adverse effects of diverting resources and attention to providing transition services to the purchaser of the large joints business; the adequacy of the company’s capital resources and need for additional financing; the timing of regulatory approvals and introduction of new products; physician acceptance, endorsement, and use of new products; failure to achieve the anticipated benefits from approval of AUGMENT® Bone Graft; the effect of regulatory actions, changes in and adoption of reimbursement rates; product liability claims and product recalls; pending and threatened litigation; risks associated with the metal-on-metal master settlement agreement and the settlement agreement with the three settling insurers; risks associated with the subsequent metal-on-metal settlement agreements and ability to obtain the additional new insurance proceeds contingent thereon; risks associated with international operations and expansion; fluctuations in foreign currency exchange rates; other business effects, including the effects of industry, economic or political conditions outside of the company’s control; reliance on independent distributors and sales agencies; competitor activities; changes in tax and other legislation; and the risks identified under the heading “Risk Factors” in Wright’s Annual Report on Form 10-K for the year ended
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