Zimmer Biomet Announces Definitive Agreement to Acquire Paragon 28
Zimmer Biomet (NYSE: ZBH) has announced a definitive agreement to acquire Paragon 28 (NYSE: FNA) for $13.00 per share in cash, representing an equity value of approximately $1.1 billion and enterprise value of $1.2 billion. Paragon 28 shareholders will receive a non-tradeable contingent value right (CVR) worth up to $1.00 per share if certain revenue milestones are achieved in fiscal year 2026.
The acquisition expands Zimmer Biomet's presence in the ~$5 billion foot and ankle segment. Paragon 28, established in 2010, offers surgical solutions across major foot and ankle segments. The transaction is expected to immediately accelerate Zimmer Biomet's revenue growth, with Paragon 28's projected 2024 net revenue between $255.9-256.2 million, representing 18.2-18.4% growth.
The deal is anticipated to close in first half of 2025, subject to regulatory approvals and Paragon 28 stockholder approval. It is expected to be approximately 3% dilutive to adjusted EPS in 2025, 1% dilutive in 2026, and accretive within 24 months of closing.
Zimmer Biomet (NYSE: ZBH) ha annunciato un accordo definitivo per acquisire Paragon 28 (NYSE: FNA) al prezzo di 13,00 dollari per azione in contante, il che rappresenta un valore azionario di circa 1,1 miliardi di dollari e un valore aziendale di 1,2 miliardi di dollari. Gli azionisti di Paragon 28 riceveranno un diritto di valore contingente (CVR) non trasferibile del valore di fino a 1,00 dollaro per azione se verranno raggiunti determinati obiettivi di fatturato nell'anno fiscale 2026.
L'acquisizione amplia la presenza di Zimmer Biomet nel segmento dei piedi e caviglie, che vale circa 5 miliardi di dollari. Paragon 28, fondata nel 2010, offre soluzioni chirurgiche in diversi segmenti chiave per piedi e caviglie. Si prevede che la transazione acceleri immediatamente la crescita dei ricavi di Zimmer Biomet, con le entrate nette previste per Paragon 28 nel 2024 tra 255,9 e 256,2 milioni di dollari, corrispondenti a una crescita del 18,2-18,4%.
Si prevede che l'accordo si concluda nella prima metà del 2025, soggetto ad approvazioni regolatorie e all'approvazione degli azionisti di Paragon 28. Si stima che sarà diluitivo per circa il 3% dell'EPS rettificato nel 2025, per l'1% nel 2026, e accretivo entro 24 mesi dalla chiusura.
Zimmer Biomet (NYSE: ZBH) ha anunciado un acuerdo definitivo para adquirir Paragon 28 (NYSE: FNA) por 13,00 dólares por acción en efectivo, lo que representa un valor de capital de aproximadamente 1.1 mil millones de dólares y un valor empresarial de 1.2 mil millones de dólares. Los accionistas de Paragon 28 recibirán un derecho de valor contingente (CVR) no negociable por un valor de hasta 1,00 dólar por acción si se alcanzan ciertos hitos de ingresos en el año fiscal 2026.
La adquisición amplía la presencia de Zimmer Biomet en el segmento de pies y tobillos de aproximadamente 5 mil millones de dólares. Paragon 28, fundada en 2010, ofrece soluciones quirúrgicas en segmentos clave de pies y tobillos. Se espera que la transacción acelere inmediatamente el crecimiento de los ingresos de Zimmer Biomet, con ingresos netos proyectados para Paragon 28 en 2024 entre 255.9 y 256.2 millones de dólares, lo que representa un crecimiento del 18.2-18.4%.
Se anticipa que el acuerdo se cierre en la primera mitad de 2025, sujeto a aprobaciones regulatorias y la aprobación de los accionistas de Paragon 28. Se espera que tenga un impacto dilutivo de aproximadamente el 3% en el EPS ajustado en 2025, del 1% en 2026, y que sea accretivo dentro de 24 meses después del cierre.
Zimmer Biomet (NYSE: ZBH)는 Paragon 28 (NYSE: FNA)를 주당 13.00달러에 현금으로 인수하기로 하는 최종 계약을 발표했습니다. 이는 약 11억 달러의 자본 가치와 12억 달러의 기업 가치를 나타냅니다. Paragon 28 주주들은 2026 회계연도에 특정 수익 목표가 달성되면 주당 최대 1.00달러에 해당하는 비거래 가능한 조건부 가치 권리(CVR)를 받게 됩니다.
이번 인수는 Zimmer Biomet의 약 50억 달러 규모의 발목 및 발 부문에서의 입지를 확장합니다. 2010년에 설립된 Paragon 28은 주요 발목 및 발 부문에서 외科적 솔루션을 제공합니다. 이 거래는 Zimmer Biomet의 수익 성장을 즉각적으로 가속화할 것으로 예상되며, Paragon 28의 2024년 예상 순수익은 2억 5590만~2억 5620만 달러로, 18.2~18.4% 성장할 것으로 보입니다.
이 거래는 2025년 상반기 중에 종료될 것으로 예상되며, 규제 승인 및 Paragon 28 주주 승인에 따라 진행됩니다. 2025년에는 조정된 EPS에 약 3%로 희석되고, 2026년에는 1%로 희석되며, 거래가 종료된 후 24개월 이내에 증가할 것으로 예상됩니다.
Zimmer Biomet (NYSE: ZBH) a annoncé un accord définitif pour acquérir Paragon 28 (NYSE: FNA) pour 13,00 dollars par action en espèces, représentant une valeur des capitaux propres d'environ 1,1 milliard de dollars et une valeur d'entreprise de 1,2 milliard de dollars. Les actionnaires de Paragon 28 recevront un droit de valeur conditionnelle (CVR) non négociable d'une valeur allant jusqu'à 1,00 dollar par action si certains jalons de revenus sont atteints au cours de l'exercice 2026.
L'acquisition élargit la présence de Zimmer Biomet dans le segment des pieds et des chevilles d'environ 5 milliards de dollars. Paragon 28, fondée en 2010, propose des solutions chirurgicales dans les principaux segments du pied et de la cheville. On s'attend à ce que la transaction accélère immédiatement la croissance des revenus de Zimmer Biomet, avec des revenus nets projetés pour Paragon 28 en 2024 compris entre 255,9 et 256,2 millions de dollars, représentant une croissance de 18,2 à 18,4%.
L'accord devrait être finalisé au cours du premier semestre 2025, sous réserve des approbations réglementaires et de l'approbation des actionnaires de Paragon 28. On prévoit qu'il sera dilutif d'environ 3% sur le BPA ajusté en 2025, 1% en 2026, et qu'il sera profitant dans les 24 mois suivant la clôture.
Zimmer Biomet (NYSE: ZBH) hat eine endgültige Vereinbarung zur Übernahme von Paragon 28 (NYSE: FNA) zu einem Preis von 13,00 US-Dollar pro Aktie in bar angekündigt, was einen Eigenkapitalwert von etwa 1,1 Milliarden US-Dollar und einen Unternehmenswert von 1,2 Milliarden US-Dollar darstellt. Die Aktionäre von Paragon 28 erhalten ein nicht handelbares bedingtes Wertrecht (CVR) im Wert von bis zu 1,00 US-Dollar pro Aktie, wenn bestimmte Umsatzmeilensteine im Geschäftsjahr 2026 erreicht werden.
Die Übernahme erweitert die Präsenz von Zimmer Biomet im etwa 5 Milliarden US-Dollar großen Fuß- und Sprunggelenksegment. Paragon 28, 2010 gegründet, bietet chirurgische Lösungen in den wichtigsten Fuß- und Sprunggelenksegmenten an. Die Transaktion wird voraussichtlich das Umsatzwachstum von Zimmer Biomet sofort beschleunigen, mit prognostizierten Nettoumsätzen von Paragon 28 im Jahr 2024 zwischen 255,9 und 256,2 Millionen US-Dollar, was einem Wachstum von 18,2-18,4% entspricht.
Der Abschluss des Deals wird im ersten Halbjahr 2025 erwartet, vorbehaltlich der behördlichen Genehmigungen und der Zustimmung der Aktionäre von Paragon 28. Es wird erwartet, dass dies im Jahr 2025 etwa 3% verwässernd auf das bereinigte EPS und im Jahr 2026 1% verwässernd sein wird, und dass es innerhalb von 24 Monaten nach Abschluss gewinnbringend sein wird.
- Expansion into high-growth foot and ankle segment worth ~$5 billion
- Immediate acceleration of revenue growth with Paragon 28's 18.2-18.4% growth rate
- Cross-selling opportunities in fast-growing ASC space
- Accretive to adjusted EPS within 24 months of deal close
- 3% dilutive to adjusted EPS in 2025
- 1% dilutive to adjusted EPS in 2026
- Significant cash outlay of $1.2 billion for acquisition
Insights
This strategic acquisition marks a calculated expansion by Zimmer Biomet into the specialized
- The deal structure combines an immediate
$13.00 per share cash payment with a performance-based CVR of up to$1.00 , providing both certainty and upside potential for Paragon 28 shareholders - Paragon 28's impressive
18.3% revenue growth trajectory significantly outpaces the industry's high-single-digit growth rate, justifying the acquisition premium - The expected initial EPS dilution (approximately
3% in 2025 and1% in 2026) before turning accretive within 24 months suggests confidence in achieving operational synergies and revenue acceleration - The transaction's structure maintains Zimmer Biomet's balance sheet flexibility while targeting a high-growth segment, important for sustainable portfolio optimization
The CVR milestone structure, requiring between
This acquisition represents a strategic masterpiece in specialized orthopedics for several key reasons:
- The foot and ankle segment's complexity has historically created high barriers to entry, making Paragon 28's specialized expertise and comprehensive product portfolio particularly valuable
- The deal accelerates Zimmer Biomet's presence in a rapidly growing market segment while providing immediate access to Paragon 28's dedicated sales force and established surgeon relationships
- Cross-selling opportunities in the ASC channel are significant, as foot and ankle procedures increasingly migrate to outpatient settings
- The combination of Zimmer Biomet's global distribution network with Paragon 28's innovative product pipeline creates a powerful platform for international expansion
The transaction's timing is particularly strategic as the foot and ankle segment experiences accelerated growth driven by aging demographics, increased sports participation and advances in surgical techniques. Paragon 28's exclusive focus on foot and ankle since 2010 has resulted in deep clinical expertise and strong surgeon loyalty, assets that typically take years to develop organically.
Demonstrates Zimmer Biomet's Commitment to Investing in Higher Growth
End-Markets, with Expansion into
Expected to Enhance Zimmer Biomet's Financial Profile; Immediately Accretive to Revenue Growth and Accretive to Adjusted EPS within 24 Months of Deal Close
WARSAW, Ind. and
Established in 2010, Paragon 28 has an extensive suite of surgical offerings and product systems spanning all major foot and ankle segments, including fracture and trauma, deformity correction and joint replacement. Since its inception, Paragon 28 has been singularly focused on bringing to market innovative solutions to address areas of unmet need in the foot and ankle segment.
"This proposed transaction further diversifies Zimmer Biomet's portfolio outside of core orthopedics and positions us well in one of the highest growth specialized segments in musculoskeletal care, while creating cross-selling opportunities in the rapidly growing ASC space," said Ivan Tornos, President and Chief Executive Officer of Zimmer Biomet. "Paragon 28's broad and innovative foot and ankle portfolio, robust product pipeline and dedicated and highly trained sales force, combined with Zimmer Biomet's global reach and capabilities, will uniquely position us to address the unmet patient needs of this highly complex anatomy."
"We are incredibly proud of the legacy we have built at Paragon 28 as an industry leader committed to continuously improving the outcomes and experiences of patients suffering from foot and ankle conditions," said Albert DaCosta, Chairman and CEO of Paragon 28. "Joining Zimmer Biomet is an exciting new chapter for Paragon 28 and an incredible opportunity to advance our mission and continue to deliver groundbreaking solutions in the foot and ankle segment."
Benefits of the Proposed Transaction
Strengthens and expands Zimmer Biomet's foot and ankle offerings through Paragon 28's leading technology platform while bolstering existing fracture & trauma and joint replacement portfolios.
Complements Zimmer Biomet's global footprint and existing infrastructure with Paragon 28's expansive portfolio, which is expected to drive adoption and accelerate
Accelerates Zimmer Biomet's WAMGR given significant opportunity across a
Expedites penetration opportunities in the fast-growing ASC space.
Proposed Transaction Highlights
The proposed transaction is expected to immediately accelerate Zimmer Biomet's revenue growth. Paragon 28 has announced net revenue for the full year of 2024 to be in a range of
Zimmer Biomet plans to fund the proposed transaction through a combination of cash on the balance sheet and other available debt financing sources. Zimmer Biomet expects to maintain a strong balance sheet and to continue to support its stated capital allocation priorities.
Closing of the proposed transaction is subject to receipt of required regulatory approvals, approval by Paragon 28 stockholders and other customary closing conditions, and is anticipated to close in the first half of 2025. Expected impacts to 2025 financial results will be discussed on Zimmer Biomet's upcoming fourth quarter 2024 earnings call scheduled for February 6, 2025.
Advisors
Goldman Sachs & Co. LLC is serving as exclusive financial advisor to Zimmer Biomet and Hogan Lovells US LLP is serving as legal advisor.
Piper Sandler & Co. is serving as exclusive financial advisor to Paragon 28 and Cravath, Swaine & Moore LLP is serving as legal advisor.
About Zimmer Biomet
Zimmer Biomet is a global medical technology leader with a comprehensive portfolio designed to maximize mobility and improve health. We seamlessly transform the patient experience through our innovative products and suite of integrated digital and robotic technologies that leverage data, data analytics and artificial intelligence.
With 90+ years of trusted leadership and proven expertise, Zimmer Biomet is positioned to deliver the highest quality solutions to patients and providers. Our legacy continues to come to life today through our progressive culture of evolution and innovation.
For more information about our product portfolio, our operations in 25+ countries and sales in 100+ countries or about joining our team, visit www.zimmerbiomet.com or follow on LinkedIn at www.linkedin.com/company/zimmerbiomet or X/ Twitter at www.twitter.com/zimmerbiomet.
About Paragon 28
Based in
Cautionary Statement Regarding Forward-Looking Statements
This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 regarding Zimmer Biomet and Paragon 28, which involves substantial risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. In some cases, forward-looking statements can be identified by the use of forward-looking terms such as "anticipate," "estimate," "believe," "continue," "could," "intend," "may," "plan," "potential," "predict," "should," "will," "expect," "are confident that," "objective," "projection," "forecast," "goal," "guidance," "outlook," "effort," "target," "would" or the negative of these terms or other comparable terms. Forward-looking statements in this release include, among other things, statements about the potential benefits of the proposed transaction; anticipated accretion and growth rates; plans, objectives, beliefs, expectations and intentions of the board of directors of Zimmer Biomet, Zimmer Biomet management, the board of directors of Paragon 28 and Paragon 28 management; the financial condition, results of operations and businesses of Zimmer Biomet and Paragon 28; the possibility that the milestone associated with the contingent value rights are achieved in part or at all; and the anticipated timing of closing of the proposed transaction.
These forward-looking statements are based on certain assumptions and analyses made by Zimmer Biomet and Paragon 28 in light of Zimmer Biomet and Paragon 28's experience and Zimmer Biomet and Paragon 28's perception of historical trends, current conditions and expected future developments, as well as other factors Zimmer Biomet and Paragon 28 believe are appropriate in the circumstances. These forward-looking statements also are based on the current expectations and beliefs of the respective managements of Zimmer Biomet and Paragon 28 and are subject to certain known and unknown risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Risks and uncertainties include, among other things, (i) risks related to the satisfaction of the conditions to closing the proposed transaction (including the failure to obtain necessary regulatory approvals) in the anticipated timeframe or at all, including uncertainties as whether the stockholders of Paragon 28 will approve the proposed transaction and the possibility that the proposed transaction does not close; (ii) risks related to the possibility that competing offers or acquisition proposals for Paragon 28 will be made; (iii) the occurrence of any event, change or other circumstances that could give rise to the termination of the definitive transaction agreement relating to the proposed transaction, including in circumstances which would require Paragon 28 to pay a termination fee; (iv) risks related to the ability to realize the anticipated benefits of the proposed transaction, including the possibility that the expected benefits from the proposed transaction will not be realized or will not be realized within the expected time period; (v) the risk that the businesses will not be integrated successfully; (vi) risks relating to the achievement, in part or at all, of the revenue milestone necessary for the payment of any contingent value rights; (vii) disruption from the proposed transaction making it more difficult to maintain business and operational relationships, including with customers, vendors, service providers, independent sales representatives, agents or agencies, and Paragon 28's ability to attract, motivate or retain key executives, employees and other associates; (viii) risk related to the proposed transaction diverting Zimmer Biomet's and/or Paragon 28's managements' attention from the ongoing business operations of their respective business; (ix) negative effects of this announcement or the consummation of the proposed transaction on the market price of Zimmer Biomet and/or Paragon 28's common stock and on Zimmer Biomet and/or Paragon 28's operating results; (x) significant transaction costs; (xi) unknown liabilities; (xii) the risk of litigation, including shareholder litigation, and/or regulatory actions, including any conditions, limitations or restrictions placed on approvals by any applicable governmental entities, related to the proposed transaction; and (xiii) (A) other risks and uncertainties discussed in Zimmer Biomet's and Paragon 28's respective Annual Reports on Form 10-K or Form 10-K/A, as applicable, for the fiscal year ended December 31, 2023 and their subsequent Quarterly Reports on Form 10-Q (in particular, the risk factors set forth under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in such Annual Reports and Quarterly Reports), and (B) other risk factors identified from time to time in other filings with the
The list of factors that may affect actual results and the accuracy of forward-looking statements is illustrative and is not intended to be exhaustive. Readers are cautioned not to place undue reliance on any of these forward-looking statements. These forward-looking statements speak only as of the date hereof. Zimmer Biomet and Paragon 28 undertake no obligation to update any of these forward-looking statements as the result of new information or to reflect events or circumstances after the date of this communication or to reflect actual outcomes, expect as required by law, and expressly disclaim any obligation to revise or update any forward-looking statement to reflect future events or circumstances.
Additional Information about the Proposed Transaction and Where to Find It
In connection with the proposed transaction, Paragon 28 intends to file relevant materials with the SEC, including preliminary and definitive proxy statements relating to the proposed transaction. The definitive proxy statement will be mailed to Paragon 28's stockholders in connection with the proposed transaction. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY HOLDERS OF PARAGON 28 ARE URGED TO READ THE PRELIMINARY AND DEFINITIVE PROXY STATEMENTS AND ALL RELEVANT DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED TRANSACTION OR INCORPORATED BY REFERENCE IN THE PROXY STATEMENT WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security holders may obtain free copies of these documents (if and when they are available) and other related documents filed with the SEC at the SEC's web site at www.sec.gov, and on Paragon 28's website at www.paragon28.com. In addition, the proxy statement and other documents may be obtained free of charge by directing a request to Paragon 28, Inc., Robert McCormack, 14445 Grasslands Drive,
Participants in the Solicitation
Zimmer Biomet and Paragon 28 and their respective directors and executive officers and other members of management and employees, under SEC rules, may be deemed participants in the solicitation of proxies from the stockholders of Paragon 28 in connection with the proposed transaction. Information regarding Zimmer Biomet's directors and executive officers can be found in Zimmer Biomet's definitive proxy statement on Schedule 14A for the 2024 Annual Meeting of Stockholders, filed with the SEC on March 27, 2024 and subsequent statements of beneficial ownership on file with the SEC. Information regarding Paragon 28's directors and executive officers can be found in Paragon 28's definitive proxy statement on Schedule 14A for the 2024 Annual Meeting of Stockholders, which was filed with the SEC on April 5, 2024 and subsequent statements of beneficial ownership on file with the SEC. These documents are available free of charge at the SEC's web site at www.sec.gov, on Zimmer Biomet's website at www.zimmerbiomet.com and on Paragon 28's website at www.paragon28.com. Additional information regarding the interest of Paragon 28's participants in the solicitation of Paragon 28' stockholders, which may, in some cases, be different than those of Paragon 28's stockholders generally, will be set forth in the proxy statement related to the proposed transaction described above and other relevant materials to be filed with the SEC if and when they become available.
Zimmer Biomet:
Media Kirsten Fallon | Investors Zach Weiner | |
Paragon 28 |
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SOURCE Zimmer Biomet Holdings, Inc.
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