Zimmer Biomet has signed a deal to buy A&E Medical, maker of open chest surgery tools, for $250 million in cash. Separately, the company launched a new charitable foundation, and started a partnership with the NAACP in support of its public health and justice efforts.
Described as a high-growth market by the medtech manufacturer, A&E’s portfolio includes a complete line of sternum closure devices, including suture, fixation and cable systems, plus a range of disposable products such as pacing wires and punch tools used for tissue biopsies.
The acquisition has been completed, but is expected to have little impact on net revenues for the year, the company said. Zimmer Biomet signed on to pay $150 million upfront to A&E’s owners, Vance Street Capital, with the remainder to be paid in 2021.
“A&E Medical’s high-growth business and innovative products are highly complementary to our current portfolio and will allow us to offer a comprehensive suite of sternal closure products, including rigid fixation, which has the potential to shift the standard of care and address a variety of unmet patient and surgical needs,” said Bryan Hanson, President and CEO of Zimmer Biomet, which estimates that the global sternal closure business is currently growing by high single-digit percentages each year.
A&E was founded in 1968, with headquarters in Farmingdale, New Jersey. It was acquired by Vance Street Capital in 2016.
“This deal aligns with our active portfolio management strategy and the ongoing transformation of our business that will position Zimmer Biomet for long-term growth,” Hanson added.
Meanwhile, the company also launched the Zimmer Biomet Foundation, a philanthropic organization aimed at supporting diverse and underserved communities, STEM education, community health and disaster relief.
This includes a partnership with the NAACP’s charity arm, Empowerment Programs, Inc., plus a $2 million commitment over the next three years to support the organization’s efforts to end racial injustice and advance diversity and equality.
The funds will help support the public health work being done by local NAACP chapters across the country, and will help set up the first NAACP Black Opportunity Index, designed as a resource for addressing healthcare disparities and expanding medical access within underserved communities.
More broadly, Zimmer Biomet has pledged to donate at least $5 million over the next five years to non-profits that focus on anti-racism, equity and inclusion.
“Earlier this year, we also chose to stand with the millions in the United States and abroad who have built a united front against hatred, discrimination and injustice,” Hanson said. “By partnering with the NAACP, we have a unique opportunity to put our beliefs into action and support initiatives that show the many ways that diversity and tolerance make all of us stronger.”