SafeStitch Medical, Inc. has entered into a definitive agreement to merge with robot-assisted device company TransEnterix, Inc. The collaboration is expected to leverage the strengths of both companies and is accompanied by a $30M private placement to help oil the wheels.
SafeStitch Medical, Inc. is an established, publicly traded medical device company founded in 2006. It focuses on developing disposable medical devices to advance minimally invasive surgery for hernia repair, treatment of obesity and other gastroesophageal disorders. SafeStitch Medical has developed and obtained FDA approval to market the AMID Hernia Fixation Device (HFD) for both inguinal and ventral hernia repairs, with claims the system allows for faster mesh manipulation, mesh fixation and skin closure.
TransEnterix is a development stage medical device company that is pioneering the use of flexible instruments and robotics to improve how minimally invasive surgery is performed. TransEnterix is focused on the development and commercialization of a novel robotic-assisted surgical system.
Current shareholders of SafeStitch Medical and TransEnterix will own approximately 35% and 65% of the combined company, respectively, with the merger expected to close in the 2013 third quarter. The structure of the transaction will be in the form of a reverse triangular merger with SafeStitch Medical as the surviving corporation and will now be headquartered in the Research Triangle, North Carolina. The combined company will continue to trade on the OTCBB under the symbol SFES initially.
Personnel-wise, Todd M. Pope, the existing Chief Executive Officer of TransEnterix, will become the Chief Executive Officer and a Director of the combined company. Paul LaViolette, the current Chairman of TransEnterix, will serve as Chairman of the combined company’s Board of Directors. Dr. Jane Hsiao, the current Chairwoman of SafeStitch Medical will remain a Director, and Dr. Phillip Frost, Chief Executive Officer and Chairman of OPKO Health, Inc. will join as a Director.
Commenting on the merger, Dr. Jane Hsiao, Chairwoman of SafeStitch Medical stated; “We are excited about the breadth of the management team of TransEnterix. There are compelling advantages to innovative flexible technologies and robotics for less invasive surgical interventions, such as our proprietary trans-oral device. This merger will provide greater resources to help bring the pipeline products of the combined company to market and offer our shareholders an excellent opportunity to realize significant value of their investment.”
Todd M. Pope said; “We believe this merger will significantly enhance our ability to bring our innovative robotic surgery platform to market. Drs. Frost and Hsiao have a proven track record of driving healthcare innovation while creating significant value for shareholders. We expect the company will be at the forefront of advancements in minimally invasive surgery.”
Source: SafeStitch Medical, Inc.