Globus Medical has entered into an agreement to acquire Alphatec Holdings’ international operations and distribution channels.
It will also extend to Alphatec a 5-year senior secured credit facility amounting to up to $30 million. The $80 million cash acquisition is scheduled to complete by October 2016, as long as conditions are satisfied.
As far as intentions go, Globus has plans to sell its own products through Alphatec’s international direct and distributor sales channels--a network that generated around $71 million in 2015 and has already brought in $15.6 million in Q1 2016. The agreement comes with the condition that Alphatec will supply Globus with its products for up to 5 years.
David Paul, chairman and CEO of Globus, noted that the acquisition will offer immediate access to Japan and will nearly double the company’s international sales. “In addition, we will be acquiring a talent pool of international sales professionals as well as an extensive network of international distributors,” he continued in his statement. “We expect the impact to be marginally accretive in 2017 as we work through our transition and integration plans and to provide up to 8 cents per share in incremental non-GAAP diluted earnings per share (EPS) in 2018 and beyond.”
Globus expects to see around $10 million of additional sales come in for Q4 2016 with earnings remaining neutral, except for acquisition-related costs. In 2017 Globus expects to bring in an additional $40 million in sales and to contribute non-GAAP EPS of around $0.03 to $0.05.
- here's the press release