A Medical Device Daily

Teleflex (Limerick, Pennsylvania) said that it has entered into a definitive agreement to sell its SSI Surgical Services (Orlando, Florida) business to a privately-owned multi-service line healthcare company for nearly $25 million. The transaction is subject to customary closing conditions and is expected to close before the end of 1Q10.

"The decision to divest SSI was made following a review of our portfolio and it was determined that SSI was not a strategic fit. This allows us to continue to reallocate resources to our higher margin businesses," the company said.

SSI, with annual revenues of nearly $20 million, offers a range of endoscopic surgical services and sterile processing management services to help hospitals and surgery centers control costs and improve operational efficiency.

As a result of this agreement, SSI will be reflected in Teleflex's future consolidated financial statements as a discontinued operation. Although this transaction is expected to be slightly dilutive to 2010 earnings per share, the underlying strength of Teleflex's existing businesses is expected to offset this dilution. As a result, Teleflex does not anticipate this transaction will have an impact on its previously provided 2010 financial outlook.

In other dealmaking activity, Alphatec Holdings (Carlsbad, California) the parent company of Alphatec Spine said that the Hart-Scott-Rodino (HSR) review period for Alphatec Spine's proposed acquisition of Scient'x Groupe (Guyancourt, France) has expired with no action by the U.S. Federal Trade Commission.

The expiration of the HSR review period satisfies one of the conditions necessary for the transaction to close. The company has set Feb. 9, 2010 as the record date for the special meeting of its shareholders to approve the issuance of the shares of its common stock in the transaction.

The special meeting of the company's shareholders will be held on Tuesday, March 16, 2010. Alphatec expects that, subject to the remaining customary closing conditions, the transaction will be completed by the end of the 1Q 10.

On Dec. 17, 2009, the company said that it entered into a definitive agreement to acquire Scient'x Groupe in an all stock trade that was valued at about $116.4 million (Medical Device Daily, Dec. 21, 2010).

The transaction is structured as an all stock transaction such that 100% of outstanding Scient'x stock will be exchanged pursuant to a fixed ratio of 24 million shares of the company's common stock. On a pro forma basis, the company's shareholders will own nearly 69% of the combined company and nearly 31% will be held by current Scient'x shareholders.

Both companies operate in the spinal implant market. The worldwide spinal implant market in 2009 is estimated to be $8.5 billion to $9 billion with a long-term growth rate that is estimated to be between 10% and 12%, according to Alphatec.

"We believe that Scient'x is a perfect complementary strategic fit for Alphatec Spine," said Dirk Kuyper, Alphatec Spine's president/CEO. "Besides the significant cost and revenue synergies the acquisition offers, Alphatec Spine will now have the opportunity to reach 50 international markets with our aging spine and core fusion technologies. This transaction moves us into position to be able to become one of the top global spine companies."