Symmetry Medical Inc. announced Monday that it has entered into a definitive asset purchase agreement to acquire the surgical instruments business of Codman & Shurtleff Inc., a Johnson & Johnson company.
Codman’s line of surgical instruments will be integrated with Symmetry’s current hospital direct business, Specialty Surgical Instrumentation, creating a new business segment with more than $100 million in combined annual sales in the $1 billion worldwide market for general surgical instruments.
The combined hospital direct general surgical instruments business will be re-named Symmetry Surgical and will be based in Nashville, Tenn.
Under terms of the agreement, Symmetry will acquire the surgical instruments product portfolio and associated assets of Codman for $165 million in cash.
Codman will provide transitional services to Symmetry Surgical for a period of time following the close of the transaction, including serving as master distributor outside the U.S. and providing certain administrative support.
Symmetry intends to finance the acquisition through an amendment to its Senior Secured Credit Facility and the issuance of $65 million of senior subordinated notes.
The transaction will be structured as an asset purchase resulting in significant future tax benefits related to the acquisition of assets. The transaction is expected to close by the end of this year, subject to customary closing conditions and any necessary governmental approvals.
The transaction includes Codman’s reusable stainless steel and titanium surgical hand-held instruments and retractor systems, sterile disposable surgical products (vein strippers, SECTO dissectors, tonsil sponges and surgical marker pens) and sterilization containers. These products are typically used in the surgical specialties of spine, general/OB-GYN, microsurgery/neurosurgery, orthopedics, laparoscopy, cardiovascular, thoracic and general surgery.
