Hints and tips:
...US medical device maker Stryker will buy smaller rival Wright Medical in a deal worth $5.4bn including debt as it seeks to boost its exposure to the fast-growing orthopaedics market....
...Twelve times 2021 ev/ebitda looks cheap versus 13.5 times for Zimmer and Stryker, they say: We are upgrading SN to Overweight as we believe the fundamentals of the business are less challenged compared...
...Besides Stryker, other leaders in the industry include Johnson & Johnson, which acquired orthopaedic device maker Synthes for $21.3bn in 2012, and Zimmer Biomet, which was formed by a $14bn takeover in 2014...
...He has installed presidents for each division — sports medicine; orthopaedics and wound management — in an attempt to sharpen execution in a sector marked by constant evolution....
...Putting the orthopaedic devices or wound management businesses up for sale would likely attract interest from both industry buyers and private equity, while rivals including Stryker would likely want the...
...“[G]iven the consolidated and highly regulated nature of the mature orthopaedic space, we continue to see Stryker and (lesser so) Medtronic as the best suitors — not just from the regulatory angle (either...
...Stryker, which in 2014 disclosed that it had been working on a bid, was once again being mooted by day traders as a potential buyer....
...US rivals Stryker and Johnson & Johnson both have the capacity to bid....
...But S&N shares pared losses after Stryker management said on a post-acquisition conference call that the company “still has capacity to do more deals”, and flagged up orthopaedics as an area of interest....
...The company has been the subject of takeover speculation involving Stryker, a Fortune 500 medical technologies company based in Kalamazoo in Michigan....
...Smith & Nephew says it has proved it can prosper in the shadow of bigger rivals such as Johnson & Johnson and Stryker and stands to benefit from upheaval among its competitors....
...For all the talk of diversification, much still depends on S&N’s ability to compete in orthopaedics....
...Sector peer Stryker last year examined a bid for S&N but was said to have paused the process awaiting regulatory clearance of Zimmer’s merger....
...“Based on management commentary, we continue to believe that a deal with Stryker remains highly unlikely,” said RBC. US-based Stryker last year confirmed it had examined making an offer for S&N....
...Credit Suisse told clients: “There is ongoing M&A activity and industry consolidation in orthopaedics....
...Morgan Stanley analysts were not convinced, in part because Stryker last year chose to buy robotics maker Mako Surgical instead of taking out a direct competitor in orthopaedics....
...“Stryker does not want to be third in the orthopaedic market where it competes,” the broker told clients. Discount retailer B&M fell 1.6 per cent to 315p....
...Orthopaedics maker Smith & Nephew faded 2 per cent to £11.10 after Morgan Stanley played down hopes of a bid from US peer Stryker....
...Smith & Nephew added 4.5 per cent to 946.5p after Stryker, its US orthopaedics peer and sometime potential predator, reported an acceleration of hip and knee sales....
...Stryker’s statement came as Smith & Nephew’s share price rose 17 per cent after the Financial Times reported that the US orthopaedic products group was working on a bid....
...Medtronic had already been widely rumoured to be considering its options after its compatriot Stryker said in May that it had paused work on an S&N bid....
...Smith & Nephew hit a record closing high on Friday on hopes that the orthopaedics maker has been put into play....
...Analysts saw the potential tie-up as a defensive move in response to Zimmer’s bid for Biomet to create the world’s biggest orthopaedics maker....
...The Biomet deal would make Zimmer the second-ranking orthopaedics company by sales, behind Johnson & Johnson. Smith & Nephew would be fourth, behind Stryker....
...News of the deal follows speculation that S&N might spin off or sell its orthopaedics division....
International Edition