Wright Medical Group, which merged with Tornier last fall, announced the divestiture of its large joints business to Corin Orthopaedics for €29.7 million ($33 million) in cash.
While Wright had previously sold its hip and knee business to MicroPort in 2013, it re-entered the large joints arena via the 2015 merger with Tornier. These products are largely marketed in France and other European countries and contributed $41 million in sales in 2015. They include the Dynacup and Meije Duo hip implants and the HLS KneeTec and Noetos knee implants. The transition is expected to close in Q4 2016.
While the large joints business has “excellent products” and a “significant market share” in Europe, Wright CEO Robert Palmisano said in the statement that the unit ultimately didn’t fit in with the company’s focus on orthopedic extremities and biologics. The deal will allow Wright to keep on this trajectory, while helping Corin, a hip and knee specialist, to penetrate that market even further.
Wright is also working through settling more than 2,000 claims regarding its metal-on-metal hip implants. In November, an Atlanta jury awarded $11 million to a plaintiff whose hip implant had come loose and caused soft tissue damage.
After taxes and transaction fees, Wright expects to pick up $20 million in cash, Leerink analyst Richard Newitter wrote. “In our view, the consideration gives the company additional flexibility to either make an acquisition in the extremities/biologics space, or to help fund any potential settlement in its ongoing metal-on-metal litigation,” he wrote.
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