Smith & Nephew Sells Its Gynecology Business for $350 Million
Smith & Nephew recently announced that it will sell its gynecology business to Medtronic for $350 million. As part of the sale, Medtronic will obtain Smith & Nephew’s key gynecological surgical solution, called the TRUCLEAR System. The System is a medical technology platform used to remove abnormal uterine tissue such as polyps and fibroids for diagnostic biopsy. According to Smith & Nephew’s press release, the TRUCLEAR System generated about $56 million in revenue in 2015, which represented approximately 1% of Smith & Nephew’s total revenues.
Regarding the decision to sell its gynecology business, Olivier Bohuon, CEO of Smith & Nephew, stated:
Smith & Nephew’s management team has a strong track record of creating value through organic growth and by acquisition. The sale of our Gynaecology business demonstrates our disciplined strategic approach to capital deployment and to crystallising value through divestiture at the right time.
The quality of the Gynaecology business was reflected by the strong interest from potential buyers, allowing us to obtain an attractive valuation. Our shareholders will benefit directly from the return of the proceeds through a share buy-back programme, in-line with our capital allocation framework. Gynaecology and its employees will benefit from a new owner with a synergistic platform looking to take the business to the next level.
Smith & Nephew completed five acquisitions in 2015, primarily focusing on robotic surgery and sports medicine. For example, in October of 2015, Smith & Nephew announced that it would acquire Blue Belt Holdings, Inc. for $275 million to secure its position in the orthopedic robotics-assisted surgery.
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