Novanta Inc. (NASDAQ: NOVT), a trusted technology partner to medical and advanced technology equipment manufacturers, announced today that it has reached an agreement to acquire privately-held World of Medicine GmbH for €115 million in cash. The transaction is expected to close in the third quarter of 2017.
"Our agreement to acquire World of Medicine represents another milestone in Novanta's strategy to broaden and deepen our medical end market presence," said Matthijs Glastra, Chief Executive Officer of Novanta Inc. "We are excited for the World of Medicine team to join Novanta and believe the combination of our two companies will create substantial and lasting value for our customers, our employees, and our shareholders. We see World of Medicine as a foundation for future growth, and as the cornerstone of our expansion in the minimally invasive surgical market."
World of Medicine, based in Berlin, Germany, is the leading supplier to original equipment manufacturers ("OEM") of regulatory controlled medical insufflators, pumps, and related disposables for the minimally invasive surgical market. World of Medicine, with more than 50 patents, is regarded as one of the pioneers in equipment for minimally invasive medicine for more than forty years. The business operates as a full service OEM provider, which includes developing customized solutions for mission critical applications, clinical validation, regulatory approval support, training, and service.
Both World of Medicine and Novanta provide highly engineered innovative solutions to a broad spectrum of minimally invasive surgery OEM customers. World of Medicine's presence in Germany provides Novanta significant sales, regulatory, R&D and manufacturing capabilities in Europe, an important market for Novanta.
"The World of Medicine team has been tremendously successful in building a growing high quality company, with a strong track record of innovation and technology leadership in the medical market," said Matthijs Glastra. "This combination strengthens both companies and establishes a growing platform with $120 million in sales to the minimally invasive medicine market. Together, we will be able to better serve our customers in endoscopy, robotic surgery and other minimally invasive surgery applications with a broader offering and a global reach. We expect that this platform of diverse and complementary capabilities will open up new commercial opportunities including new future growth product categories over time."
"Joining Novanta is a strong next step in the progression of World of Medicine and we are delighted to join an organization committed to the medical market and to serving OEM customers, of which we have many in common," said Dr. Clemens Scholz, Chief Executive Officer of World of Medicine. "By joining Novanta, we feel more confident in our ability to continue to grow and serve our customers' needs globally and to accelerate our innovation engine to remain the leading full service medical OEM supplier in existing and future business fields."
The total purchase price of €115 million will be financed using the Company's amended & restated credit facility. The transaction, which is expected to be accretive to Novanta's free cash flow and non-GAAP earnings per share, is expected to add approximately €75 million in revenue to Novanta's financial results on a full year pro forma basis. World of Medicine's actual revenue and profit contribution to Novanta's 2017 financial results will depend on the ultimate date of the closing of the transaction, among other factors.
About Novanta
Novanta is a leading global supplier of core technology solutions that give healthcare and advanced industrial original equipment manufacturers ("OEMs") a competitive advantage. We combine deep proprietary technology expertise and competencies in photonics, vision and precision motion with a proven ability to solve complex technical challenges. This enables Novanta to engineer core components and sub-systems that deliver extreme precision and performance, tailored to our customers' demanding applications. The driving force behind our growth is the team of innovative professionals who share a commitment to innovation and customer success. Novanta's common shares are quoted on NASDAQ under the ticker symbol "NOVT".
More information about Novanta is available on the Company's website at www.novanta.com.
