Capitalizes on complementary global commercial
organizations and accelerates Globus Medical's and NuVasive's
globalization strategies to increase customer reach and deepen
surgeon relationships
Brings together innovative technologies to
create comprehensive procedural solutions offering to better
support surgeons, healthcare providers and patients
Leverages shared commitment to innovation to
further both companies' efforts to address the full continuum of
care and help solve unmet clinical needs
Expands operational excellence capabilities to
further serve and enable the combined commercial organizations to
better support customers
Strong financial profile and value creation
opportunity
Companies to host joint conference call today
at 8 a.m. ET
AUDUBON,
Pa. and SAN DIEGO,
Feb. 9,
2023 /PRNewswire/ -- Globus Medical (NYSE: GMED), a
leading musculoskeletal solutions company, and NUVASIVE (NASDAQ:
NUVA), the leader in spine technology innovation, today announced
they have entered into a definitive agreement to combine in an
all-stock transaction. The transaction brings together two
well-regarded technology companies in the musculoskeletal industry,
which have a shared vision focused on innovation in a relentless
pursuit of unmet clinical needs to improve patient care.
![Globus Medical Logo Globus Medical Logo](https://mma.prnewswire.com/media/1999366/Globus_Medical_Logo_Logo.jpg)
Under the terms of the agreement, which was unanimously approved
by the boards of directors of both companies, NuVasive shareholders
will receive 0.75 of a share of Globus Medical Class A common stock
for each share of NuVasive common stock owned at the closing of the
transaction. Based on this exchange ratio, the implied share price
for NuVasive would be $57.72, an
equity value of $3.1 billion, based
on Globus Medical's closing share price on February 8. Following the close of the
transaction, NuVasive shareholders will own approximately 28% of
the combined company, and Globus Medical shareholders will own
approximately 72%, on a fully diluted basis.
"This transaction reflects our mission to become the leading
musculoskeletal technology company in the world by developing
products that promote healing in patients with musculoskeletal
disorders," said Dan Scavilla,
president and chief executive officer of Globus Medical. "With
NuVasive, we can help support more patients through leading
innovation and expanding our commercial reach to provide superior
service to our surgeon and hospital partners. We look forward to
combining the NuVasive and Globus Medical teams to capitalize on
the many opportunities to improve patient care and create
sustainable shareholder value."
"Our combination with Globus Medical is transformative, joining
two companies with highly complementary capabilities, geographic
footprints and customer bases," said Chris
Barry, chief executive officer of NuVasive. "Together, we
will be able to offer an exceptional portfolio of clinically proven
solutions, supported by strong commercial and surgeon education
teams. The new company will be well-positioned to deliver value
creation for shareholders, further support our surgeon partners—and
most importantly, change the lives of more patients."
Strategic and Financial Benefits
- Complementary global scale and expanded commercial
reach. The transaction accelerates each company's
globalization strategy to target the $50
billion musculoskeletal market, which includes spine,
orthopedics, enabling technology, power tools, biologics and more.
Together, Globus Medical and NuVasive will have a presence in
more than 50 countries with more than 5,000 employees. The new
organization's larger commercial sales organization will enable it
to further penetrate existing and future markets, reaching more
surgeons and patients around the world.
- Comprehensive and innovative portfolio in spine and
orthopedics. The transaction pairs Globus Medical's and
NuVasive's complementary spine and orthopedic solutions and
enabling technologies to create one of the most comprehensive,
innovative offerings in the industry.
- Continued commitment to product development and surgeon
education. Globus Medical and NuVasive both have strong records
of developing technology that solves unmet clinical needs for the
treatment of musculoskeletal disorders. Globus Medical will
continue to prioritize collaboration with healthcare professionals
to develop these ground-breaking products and solutions to treat
the full continuum of care from planning to execution to
postoperative data.
- Expands operational capabilities. The company will
leverage operational excellence capabilities to further unlock
manufacturing capacity and asset utilization to support the
commercial organization. Globus Medical and NuVasive will benefit
from their respective operational advantages—including but not
limited to Globus Medical's strong, in-house manufacturing capacity
and NuVasive's global distribution networks, including NuVasive's
Memphis-based global distribution
center.
- Compelling upside revenue potential. The Globus Medical
and NuVasive product, customer, and geographic footprints are
highly complementary. As a result, through this transaction, the
combined company expects to serve more surgeon customers with more
solutions in more geographies around the world, creating compelling
growth opportunities over the long-term.
- Strong financial profile and value creation opportunity.
The combined companies have strong track records of delivering
above-market net sales growth, through their innovation and
commercial channels. The company will leverage Globus Medical's
financial rigor and discipline as it aims to deliver a
mid-30-percent EBITDA profile over the next three years, which
includes approximately $170 million
in identified cost synergies.
Leadership
Upon closing of the transaction, the combined company will have
an eleven-member board composed of all eight directors from Globus
Medical's board and three directors from NuVasive's board.
David Paul, Chairman of the
Globus Medical board of directors, will serve as Chairman of the
combined company's board of directors, Dan
Scavilla will serve as chief executive officer and as a
member of the board, Keith Pfeil,
chief financial officer of Globus Medical, will serve as chief
financial officer of the combined company, and Chris Barry, chief executive officer of
NuVasive, will support integration planning of the combined
company.
Globus Medical's and NuVasive's executive leadership teams will
be actively involved in integration planning. Integration efforts
will be focused on ensuring continued sales and innovation
execution, retaining critical talent, and delivering on growth and
cost synergies.
Approvals and Time to Close
The transaction is expected to close in the middle of 2023,
subject to the approval of both companies' shareholders, regulatory
approval, and other customary closing conditions.
Financial Outlook
For full year 2022:
- Globus Medical announces preliminary 2022 net sales growth of
6.8% as reported, 8.2% constant currency, as compared to net sales
of $958.1 million for the full year
2021; and
- NuVasive announces preliminary 2022 net sales growth of 5.5% as
reported, 8.5% constant currency, as compared to net sales of
$1,139.0 million for the full year
2021.
For full year 2023:
- Globus Medical expects 2023 net sales growth of 7%ꟷ8% constant
currency, as compared to full year 2022; and
- NuVasive expects 2023 net sales growth of 6%ꟷ8% constant
currency, as compared to full year 2022.
Globus Medical will report full financial results for 2022 and
provide its financial outlook for 2023 during its earnings
announcement planned for February 21.
NuVasive will report full financial results for 2022 and provide
its financial outlook for 2023 during its earnings announcement
planned for February 22.
* Net sales on a constant currency basis excludes impacts of
year-over-year foreign currency fluctuations.
Advisors
Goldman Sachs & Co. LLC is serving as financial advisor to
Globus Medical, and Goodwin Proctor LLP is serving as legal
counsel. BofA Securities, Inc. is serving as financial advisor to
NuVasive, and Wachtell, Lipton, Rosen & Katz is serving as
legal counsel.
Conference Call and Webcast
Globus Medical and NuVasive will host a joint conference call
today at 8 a.m. ET to discuss the
transaction.
Participants may access the conference call live via webcast and
associated presentation materials on the investor relations section
of Globus Medical and NuVasive's websites or via this link.
To participate via telephone, please register via this link.
Upon registration, all telephone participants will receive a
confirmation email detailing how to join the conference call,
including the dial-in number along with a unique passcode and
registrant ID that can be used to access the call.
About Globus Medical
Globus Medical is a leading musculoskeletal solutions company
based in Audubon, PA. The company was founded in 2003 by
an experienced team of professionals with a shared vision to create
products that enable surgeons to promote healing in patients with
musculoskeletal disorders. Additional information can be accessed
at www.globusmedical.com.
About NuVasive
NuVasive is a leader in spine technology innovation, with a
mission to transform surgery, advance care, and change lives. The
company's less-invasive, procedurally integrated surgical solutions
are designed to deliver reproducible and clinically proven
outcomes. With more than $1 billion in net
sales, NuVasive operates in more than 50 countries
serving surgeons, hospitals, and patients. For more information,
please visit www.nuvasive.com.
No Offer or Solicitation
This communication is for informational purposes only and is not
intended to and does not constitute an offer to subscribe for, buy
or sell, or the solicitation of an offer to subscribe for, buy or
sell, or a solicitation of any vote or approval in any
jurisdiction, nor shall there be any sale, issuance or transfer of
securities in any jurisdiction in which such offer, sale or
solicitation would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offer of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended, and otherwise in accordance with
applicable law.
Non-GAAP Financial Measures
This communication includes certain non-GAAP measures not based
on generally accepting accounting principles. These non-GAAP
measures are in addition to, not a substitute for or superior to,
measures of financial performance prepared in accordance with GAAP.
The non-GAAP measures used by Globus Medical and/or NuVasive may
differ from the non-GAAP measured used by other companies.
Cautionary Notes on Forward-Looking Statements
This communication contains "forward-looking statements" within
the meaning of the federal securities laws, including Section 27A
of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended. In this
context, forward-looking statements often address expected future
business and financial performance and financial condition, and
often contain words such as "expect," "anticipate," "intend,"
"plan," "believe," "seek," "see," "will," "would," "may," "target,"
and similar expressions and variations or negatives of these words.
Forward-looking statements by their nature address matters that
are, to different degrees, uncertain, such as statements about the
consummation of the proposed transaction and the anticipated
benefits thereof. Forward-looking statements also include
statements regarding the companies' expected net sales results for
2022 and financial outlook for 2023. These and other
forward-looking statements are not guarantees of future results and
are subject to risks, uncertainties and assumptions that could
cause actual results to differ materially from those expressed in
any forward-looking statements, including the failure to consummate
the proposed transaction or to make any filing or take other action
required to consummate such transaction in a timely matter or at
all. Important risk factors that may cause such a difference
include, but are not limited to: (i) the proposed transaction may
not be completed on anticipated terms and timing, (ii) a condition
to closing of the transaction may not be satisfied, including
obtaining shareholder and regulatory approval, (iii) the
anticipated tax treatment of the transaction may not be obtained,
(iv) the potential impact of unforeseen liabilities, future capital
expenditures, revenues, costs, expenses, earnings, synergies,
economic performance, indebtedness, financial condition and losses
on the future prospects, business and management strategies for the
management, expansion and growth of the combined business after the
consummation of the transactions, (v) potential litigation relating
to the proposed transaction that could be instituted against Globus
Medical, NuVasive or their respective directors, (vi) potential
adverse reactions or changes to business relationships resulting
from the announcement or completion of the transactions, (vii) any
negative effects of the announcement, pendency or consummation of
the transactions on the market price of Globus Medical's or
NuVasive's common stock and on Globus Medical's or NuVasive's
businesses or operating results, (viii) risks associated with third
party contracts containing consent and/or other provisions that may
be triggered by the proposed transaction, (ix) the risks and costs
associated with the integration of, and the ability of Globus
Medical and NuVasive to integrate, their businesses successfully
and to achieve anticipated synergies, (x) the risk that disruptions
from the proposed transaction will harm Globus Medical's or
NuVasive's business, including current plans and operations, (xi)
the ability of Globus Medical or NuVasive to retain and hire key
personnel and uncertainties arising from leadership changes, (xii)
legislative, regulatory and economic developments, and (xiii) the
other risks described in Globus Medical's and NuVasive's most
recent annual reports on Form 10-K and quarterly reports on Form
10-Q.
These risks, as well as other risks associated with the proposed
transaction, will be more fully discussed in the joint proxy
statement/prospectus that will be included in the registration
statement on Form S-4 that will be filed with the SEC in connection
with the proposed transaction. While the list of factors
presented here is, and the list of factors to be presented in the
registration statement on Form S-4 are, considered representative,
no such list should be considered to be a complete statement of all
potential risks and uncertainties. Unlisted factors may present
significant additional obstacles to the realization of
forward-looking statements. Consequences of material
differences in results as compared with those anticipated in the
forward-looking statements could include, among other things,
business disruption, operational problems, financial loss, legal
liability to third parties and similar risks, any of which could
have a material adverse effect on Globus Medical's or NuVasive's
consolidated financial condition, results of operations, credit
rating or liquidity. Neither Globus Medical nor NuVasive assumes
any obligation to publicly provide revisions or updates to any
forward looking statements, whether as a result of new information,
future developments or otherwise, should circumstances change,
except as otherwise required by securities and other applicable
laws.
Important Information About the Transaction and Where To Find
It
In connection with the proposed transaction, Globus Medical will
file with the U.S. Securities and Exchange Commission ("SEC") a
registration statement on Form S-4 that will include a joint proxy
statement of Globus Medical and NuVasive and that will also
constitute a prospectus of Globus Medical for shares of its class A
common stock to be offered in the proposed transaction. Globus
Medical and NuVasive may also file other documents with the SEC
regarding the proposed transaction. This document is not a
substitute for the joint proxy statement statement/prospectus or
registration statement or any other document which Globus Medical
or NuVasive may file with the SEC. INVESTORS AND SECURITY HOLDERS
OF GLOBUS MEDICAL AND NUVASIVE ARE URGED TO READ THE REGISTRATION
STATEMENT, WHICH WILL INCLUDE THE JOINT PROXY STATEMENT/PROSPECTUS,
AND ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED OR WILL BE FILED
WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE
DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN OR
WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION
AND RELATED MATTERS. The registration statement, definitive joint
proxy statement/ prospectus and other documents filed by Globus
Medical and NuVasive with the SEC will be available free of charge
at the SEC's website (www.sec.gov) and from Globus Medical and
NuVasive. Requests for copies of the joint proxy statement/
prospectus and other documents filed by Globus Medical with the SEC
may be made by contacting Keith
Pfeil, Chief Financial Officer by phone at (610) 930-1800 or
by email at kpfeil@globusmedical.com, and request for copies of the
joint proxy statement/prospectus and other documents filed by
NuVasive may be made by contacting Matt
Harbaugh, Chief Financial Officer, by phone at (858)
210-2129 or by email at investorrelations@nuvasive.com.
Participants in the Solicitation
Globus Medical, NuVasive, their respective directors and certain
of their executive officers and other employees may be deemed to be
participants in the solicitation of proxies from Globus Medical's
and NuVasive's shareholders in connection with the proposed
transaction. Information about the directors and executive officers
of Globus Medical and their ownership of Globus Medical stock is
set forth in Globus Medical's annual report on Form 10-K for the
fiscal year ended December 31, 2021,
which was filed with the SEC on February 17,
2022 and its proxy statement for its 2022 annual meeting of
stockholders, which was filed with the SEC on April 21, 2022. Information regarding NuVasive's
directors and executive officers is contained in NuVasive's annual
report on Form 10-K for the fiscal year ended December 31, 2021, which was filed with the SEC
on February 23, 2022, and its proxy
statement for its 2022 annual meeting of stockholders, which was
filed with the SEC on March 30, 2022.
Certain directors and executive officers of Globus Medical and
NuVasive may have a direct or indirect interest in the transaction
due to securities holdings, vesting of equity awards and rights to
severance payments. Additional information regarding the persons
who may, under the rules of the SEC, be deemed participants in the
solicitation of Globus Medical's and NuVasive's shareholders in
connection with the proposed transaction will be included in the
joint proxy statement/prospectus. These documents can be obtained
free of charge from the sources indicated above.
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SOURCE NuVasive, Inc.; Globus Medical