Wright Medical and Tornier Merge and Choose Netherlands HQ

Wright Medical Group, Inc., and Tornier N.V. have entered into a definitive merger agreement under which Wright and Tornier will combine in an all stock transaction with a combined equity value of approximately $3.3 billion.


There’s no argument about the fact that these two companies’ combined portfolios will offer a comprehensive catalogue of upper limb and extremity devices. Throw in Wright’s developing strength in biologics and it looks like a pretty compelling package.

Commentators are looking past that, however and focusing on the fact that this looks like yet another one of those “inversion” deals, which will see the new combined entity based outside the U.S. in Tornier’s Netherlands territory. The new company, to be called Wright Medical Group N.V., is valued at $3.3 billion and will maintain a U.S. headquarters in Memphis, Wright’s current home.

The terms of the agreement, which has been unanimously approved by both boards of directors, will see each outstanding share of Wright common stock exchanged for 1.0309 ordinary shares of Tornier. Upon completion of the merger, Wright shareholders will own approximately 52% of the shares of the combined company on a fully diluted basis and Tornier shareholders will own approximately 48%. This implies a per share value for Tornier that represents a 28% premium to Tornier’s closing share price on October 24, 2014, the last trading day prior to the parties entering into the agreement.

Once integrated, the companies say they anticipate revenues of the combined business growing in the mid-teens and adjusted EBITDA margins approaching 20% in three to four years.

It does sound like something of a marriage made in heaven, both companies potentially benefiting from opportunities to accelerate growth through combined direct sales and distribution networks, a broad product portfolio and deep customer relationships. Similarly the press release points to patient benefits from dedicated research and development teams that will power enhanced innovation across the combined product portfolio.

Company comments

for Wright Medical

Robert Palmisano, president and chief executive officer of Wright, stated, “This combination will create the premier Extremities-Biologics company with a broad global reach. Together, we will have one of the most comprehensive upper and lower extremity product portfolios in the market, extending our leadership position and further accelerating our growth opportunities and path to profitability, all of which we believe will generate long-term value for our shareholders. In addition, this will provide our employees with opportunities for career growth and development as part of a much larger, dynamic organization.”

for Tornier 

David Mowry, president and chief executive officer of Tornier, added, “Wright shares Tornier’s commitment to serving extremities specialists and building the leading global business in this market. Both companies have built a deep and loyal customer base and have highly complementary product portfolios, positioning the combined entity to deliver meaningful value to our shareholders. We believe that partnered together, Wright and Tornier will become the fastest-growing company in the Extremities-Biologics industry.”

Source: Wright Medical Group, Inc.

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