Exactech finalized its acquisition of North Carolina-based Altiva this week. The agreement will allow Exactech to better leverage its existing sales and distribution channels in the spinal implant market.
Altiva has a spinal fusion product line with implants and instrumentation that address major spinal pathologies. Altiva’s valuation, based on its spinal products portfolio and various distribution agreements, came to $25 million. Exactech’s final payment of $6.7 million was funded through a combination of $5.1 million from its credit line and through the issuance of approximately 75,000 shares of Exactech common stock which closed at $19.61 yesterday.
Altiva’s products are indicated for:
- Degenerative conditions, including spondylolisthesis, disc herniation and spinal stenosis.
- Scoliosis and other spinal deformities.
- Surgical correction and stabilization of the spine.
- The cervical spine. The vertebrae in this region have a very different size, shape and function than other vertebrae.
- Fractures and spinal fusion, including osteobiolgics and bone graft substitutes.
Exactech develops orthopedic implant devices, surgical instruments and biologic materials used in the restoration of bones and joints that have deteriorated as a result of injury, or diseases such as arthritis. Exactech markets its products in the U.S. and Australia, and to countries in Europe, Asia and Latin America.
In 2006, the Exactech surpassed $100 million in annual sales. Each of the company’s operating segments experienced continued growth for the year. Revenues are principally derived from joint replacement systems, including knee, shoulder, and hip implant systems, and distribution of biologic allograft services and bone cement materials used in orthopedic surgery.
Based on the results of the first nine months of 2007, Altiva’s annualized revenue is approximately $13 million. Altiva is expected to break even in terms of operating profit in the first half of 2008. Exactech expects the transaction to be neutral to earnings in 2008 and accretive in 2009.
Looking forward, Exactech updated its 2008 targets for revenue to the range of $148 million to $156 million.