
Enovis to Acquire Global Orthopedic Company LimaCorporate
Enovis Corporation, an orthopedic and rehab company, is set to acquire LimaCorporate S.p.A., a global orthopedic leader focused on innovative implant solutions, in a transformative deal valued at approximately €800 million ($846 million at current rates). This acquisition positions Enovis as a high-growth global reconstruction leader, anticipating an annual revenue of around $1 billion.
LimaCorporate, founded in 1945, has shown impressive growth over the past decade, with revenues climbing at a high single-digit CAGR and reaching low teens in recent years. The company is known for its pioneering technological solutions, including digital innovations and patient-specific hardware, designed to enhance surgeon capabilities and improve patient outcomes following joint replacement surgery.
The acquisition of LimaCorporate offers Enovis several strategic advantages, including: 1) Revenue Growth: Establishing a reconstruction business with around $1 billion in annual revenue, with nearly 50% of this revenue generated in the fast-expanding extremities markets. 2) Global Expansion: Expanding international reach through a complementary global customer base and product portfolio. 3) Operational Efficiency: Leveraging Lima’s state-of-the-art manufacturing facilities and robust innovation capabilities to enhance efficiency. 4) Enhanced Portfolio: Gaining access to Lima’s portfolio of proven surgical solutions and technologies, including 3D printed Trabecular Titanium and a comprehensive revision offering. 5) Synergies: Expecting approximately $40 million in cost synergies by year three post-closing, achieved through supply chain optimization and cost consolidation. 6) Long-Term Growth: Aligning with Enovis’ goals of high-single digit organic revenue growth and sustainable EBITDA margin expansion.
Matt Trerotola, Chair and CEO of Enovis, expressed confidence that the acquisition of Lima will create immediate and sustainable value for stakeholders, emphasizing the potential for profitable portfolio expansion and global presence growth.
The transaction includes a €700 million cash payment at closing and €100 million in shares of Enovis common stock, expected to be issued within 18 months post-closing. Enovis plans to finance the cash portion through cash on hand, its existing revolving credit facility, and financing from UBS Investment Bank and J.P. Morgan Securities LLC. Enovis expects LimaCorporate to generate sales of $290-$300 million and $70-$75 million of adjusted EBITDA in 2024. Consequently, they paid 2.9x sales and 11.7x adjusted EBITDA based upon the mid-range of the guidance.
The deal is expected to conclude in early 2024, subject to regulatory approvals and customary closing conditions. While the transaction is neutral to slightly accretive to 2024 adjusted earnings per share, it is projected to become increasingly accretive from 2025 onward. Enovis reaffirmed its 2023 full-year guidance, anticipating robust organic sales growth, adjusted EBITDA, and earnings per diluted share.
Enovis has been active on the acquisition from with two additional acquisition announcements in 2023. In June the company completed the acquisition of Novastep®, a subsidiary of Amplitude Surgical SA, and in May the company announced a definitive agreement to acquire the SEAL external fixation product line from D.N.E., LLC.