DENTSPLY SIRONA Inc. (“Dentsply Sirona”) (Nasdaq: XRAY), and Byte,
a rapidly growing clear aligner company, today announced that
Dentsply Sirona acquired Byte in an all-cash deal for $1.04
billion. Byte holds a leadership position in the rapidly growing
direct-to-consumer, doctor-directed clear aligner market. As a
result of the transaction, Dentsply Sirona adds scale to its
SureSmile® clear aligner business and strengthens its connection
with dental professionals. With the global reach and supply chain
expertise of Dentsply Sirona, and the innovative direct-to-consumer
system that Byte brings, the combined company’s clear aligner
platform is well-positioned to drive additional growth.
Byte has developed an innovative business model,
built on doctor-directed care that provides excellent outcomes for
patients with mild to moderate orthodontic needs. Byte was founded
on the commitment to improve access and affordability to
orthodontic care using a nationwide network of licensed-dentists
and orthodontists. It offers effective treatment planning and an
easy-to-use clear aligner solution delivered directly to a
consumer’s home. The CEO of Byte, Neeraj Gunsagar, and the existing
management team will continue to operate the business.
Don Casey, Chief Executive Officer of Dentsply
Sirona, said, “Over the past two years, we have executed against
our restructuring plan, strengthening the R&D, supply chain and
commercial platforms, positioning Dentsply Sirona for long-term
growth. We are excited to take the next step in our evolution by
bringing Byte into our organization. We have been pleased with the
growth of our SureSmile clear aligner business and we are confident
that adding the innovative platform of Byte adds scale for us in
the important clear aligner market. We look forward to working with
the talented team at Byte as we utilize our collective strengths to
expand patient access to quality care and support the success of
our dental partners around the world.”
Neeraj Gunsagar, CEO of Byte commented, “We’ve been
impressed with the passion that Dentsply Sirona has for innovation
in dentistry. This combination provides Byte with unmatched
resources and R&D capabilities that allow us to reach
additional customers and accelerate our mission of changing the
world one smile at a time. The transaction enhances our ability to
offer affordable care to patients and increases awareness of the
overall benefits of oral care. Our team is committed to driving our
strong growth and we are delighted to join the Dentsply Sirona
family as we execute on our shared mission.”
Jorge Gomez, Chief Financial Officer of Dentsply
Sirona, said, “As we bring the two businesses together, we are
confident that we can unlock incremental growth and further
capitalize on the increasing consumer demand for clear aligner
solutions. This transaction is immediately accretive to Dentsply
Sirona’s revenue growth rate and Non-GAAP EPS. In addition, we
expect the acquisition to be accretive to Dentsply Sirona’s
long-term financial commitments. We’re thrilled that Neeraj and his
team are joining our company as we continue to focus on driving
growth and value for our shareholders.”
Strategic and Financial Benefits
- Enhances scale in the important clear aligner
space: With the market projected to increase at a 20-25%
growth rate, Dentsply Sirona strengthens its SureSmile clear
aligner platform with the addition of the Byte business.
- Accelerates the growth and profitability of Dentsply
Sirona’s combined clear aligners business: Dentsply
Sirona’s R&D capabilities and commercial expertise offer
significant potential to drive additional growth of the Byte clear
aligner solutions. Additionally, Byte has developed an innovative
direct-to-consumer system that expands patient access, enabling
Dentsply Sirona to connect additional patients with its network of
dental partners and increase access to quality oral healthcare.
- Accretive to Dentsply Sirona’s long-term financial
targets and Non-GAAP EPS in 2021: Byte is expected to
generate 2021 run-rate sales of at least $200 million. Combined
with the SureSmile business, which has an expected revenue run-rate
of $100 million by the end of 2021, Dentsply Sirona expects a
combined clear aligner revenue run-rate in excess of $300 million
by the end of 2021. Given the proven track record of profitability
at Byte, the acquisition is expected to generate Non-GAAP EPS
accretion of at least $0.05 in 2021 and be incrementally accretive
in the years thereafter. The net present value of the tax benefits
associated with the transaction is estimated to be approximately
$160 million.
The transaction closed on December 31, 2020 and was funded with
cash on Dentsply Sirona’s balance sheet.
Centerview Partners LLC served as financial advisor to Dentsply
Sirona and Skadden, Arps, Slate, Meagher & Flom LLP served as
legal counsel. Goldman Sachs & Co. LLC and American Discovery
Capital LLC served as financial advisors to Byte, with Bodman PLC
as legal counsel.
Conference Call/Webcast InformationDentsply
Sirona’s management team will host an investor conference call and
live webcast on January 4, 2021 beginning at 8:30 am ET.
Investors can access the webcast via a link on Dentsply Sirona’s
web site at www.dentsplysirona.com. For those planning to
participate on the call, please dial +1-877-370-7637 for domestic
calls, or +1-629-228-0723 for international calls. The
Conference ID # is 8676463. A replay of the conference call
will be available online on the Dentsply Sirona web site, and a
dial-in replay will be available for one week following the call at
+1-855-859-2056 (for domestic calls) or +1-404-537-3406 (for
international calls), replay passcode # 8676463.
About Dentsply SironaDentsply Sirona is the
world’s largest manufacturer of professional dental products and
technologies, with a 132-year history of innovation and service to
the dental industry and patients worldwide. Dentsply Sirona
develops, manufactures, and markets a comprehensive solutions
offering including dental and oral health products as well as other
consumable medical devices under a strong portfolio of world class
brands. As The Dental Solutions Company, Dentsply Sirona’s products
provide innovative, high-quality and effective solutions to advance
patient care and deliver better, safer and faster dentistry.
Dentsply Sirona’s shares of common stock are listed in the United
States on Nasdaq under the symbol XRAY. Visit
www.dentsplysirona.com for more information about Dentsply Sirona
and its products.
About ByteByte’s doctor-directed clear aligner
system provides customers’ nationwide access to at-home invisible
aligners for a straighter, whiter smile. With a growing team of
over 450 employees and headquartered in Los Angeles, Byte’s
nationwide network of licensed dentists and orthodontists prescribe
and oversee every customer’s treatment plan, delivering a top-rated
consumer experience and results in up to half the time and cost of
traditional methods. At under $85 per month, Byte has found a way
to make the inaccessible, accessible — providing an easy,
convenient and affordable way to upgrade your smile through the
Byte Teledentistry platform. For more information on Byte, visit:
www.byteme.com.
Forward-Looking Statements and Associated
RisksThis communication, in addition to historical
information, contains “forward-looking statements” regarding, among
other things, future events or the future financial performance of
Dentsply Sirona. Words such as “anticipate,” “expect,” “project,”
“intend,” “believe,” and words and terms of similar substance used
in connection with any discussion of future plans, actions or
events identify forward-looking statements. Forward-looking
statements relating to the transaction include, but are not
limited to: statements about the benefits of the transaction ,
including future financial and operating results; Dentsply Sirona’s
plans, objectives, expectations and intentions; and other
statements relating to the transaction that are not
historical facts. Forward-looking statements are based on
information currently available to Dentsply Sirona and involve
estimates, expectations and projections. Investors are cautioned
that all such forward-looking statements are subject to risks and
uncertainties, and important factors could cause actual events or
results to differ materially from those indicated by such
forward-looking statements. With respect to the transaction, these
factors could include, but are not limited to: the effect of future
regulatory or legislative actions on the companies or the
industries in which they operate; the continued strength of the
dental and medical device markets; unexpected changes relating to
competitive factors in the dental and medical devices industries;
the timing, success and market reception for Dentsply Sirona’s new
and existing products; the possibility of new technologies
outdating Dentsply Sirona’s products; the outcomes of any
litigation; continued support of Dentsply Sirona’s products by
influential dental and medical professionals; changes in the
general economic environment, or social or political conditions,
that could affect the businesses; the potential impact of the
announcement or consummation of the transaction on
relationships with customers, suppliers, competitors, management
and other employees; the ability to attract new customers and
retain existing customers in the manner anticipated; the ability to
hire and retain key personnel; reliance on and integration of
information technology systems; and the potential of international
unrest, economic downturn or effects of currencies, tax
assessments, tax adjustments, anticipated tax rates, raw material
costs or availability, benefit or retirement plan costs, or other
regulatory compliance costs.
Additional information concerning other risk factors is also
contained in the section titled “Risk Factors” in Dentsply Sirona’s
Annual Report on Form 10-K for the fiscal year ended December 31,
2019 and any updating information in subsequent SEC filings
including Dentsply Sirona’s Quarterly Report on Form 10-Q for the
quarterly period ending September 30, 2020. Furthermore, many of
these risks and uncertainties are currently amplified by and may
continue to be amplified by or may, in the future, be amplified by,
the novel coronavirus (“COVID-19”) pandemic and the impact of
varying private and governmental responses that affect our
customers, employees, vendors and the economies and communities
where they operate.
Many of these risks, uncertainties and assumptions are beyond
Dentsply Sirona’s ability to control or predict. Because of these
risks, uncertainties and assumptions, you should not place undue
reliance on these forward-looking statements. Furthermore,
forward-looking statements speak only as of the information
currently available to the parties on the date they are made, and
Dentsply Sirona undertakes no obligation to update publicly or
revise any forward-looking statements to reflect events or
circumstances that may arise after the date of this communication.
Nothing in this communication is intended, or is to be construed,
as a profit forecast or to be interpreted to mean that earnings per
share for the current or any future financial years, will
necessarily match or exceed the historical published earnings per
share. Dentsply Sirona gives no assurance (1) that it will achieve
its expectations, or (2) concerning any result or the timing
thereof. All subsequent written and oral forward-looking statements
concerning Dentsply Sirona, the transaction, or other matters and
attributable to Dentsply Sirona or any person acting on their
behalf are expressly qualified in their entirety by the cautionary
statements above.
Contact Information
For Dentsply SironaInvestors:John P. SweeneyVP,
Investor
Relations+1-717-849-7863John.Sweeney@dentsplysirona.com
Media:Sard Verbinnen & CoChris
Kittredge/Warren Rizzi
+1-212-687-8080DentsplySirona-SVC@sardverb.com
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