Zimmer Biomet completes acquisition of medical device company Paragon 28

Author(s):

Todd Shryock

Key Takeaways

Zimmer Biomet's acquisition of Paragon 28 enhances its presence in the fast-growing foot and ankle orthopedic market, integrating advanced technology with existing portfolios.
The acquisition creates a dedicated sales channel for foot and ankle solutions, expected to accelerate growth in the U.S. and internationally.
The deal, valued at $13 per share with potential additional earnings, positions Zimmer Biomet to access the expanding ambulatory surgery center market.
Paragon 28 is now a wholly owned subsidiary of Zimmer Biomet, with its shares delisted from the NYSE.

Move positions Zimmer Biomet in the foot and ankle space

Zimmer Biomet acquires Paragon 28: ©Murrstock - stock.adobe.com

Zimmer Biomet Holdings Inc. announced that it has officially completed its acquisition of Paragon 28 Inc., a medical device company focused exclusively on the foot and ankle orthopedic space. The move positions Zimmer Biomet to significantly expand its presence in one of the fastest-growing segments of musculoskeletal care.

“We look forward to building on the strong foundation set by Albert DeCosta and the Paragon 28 team and are excited to officially welcome them to the Zimmer Biomet family,” said Ivan Tornos, president and CEO of Zimmer Biomet. “This combination expands our leadership in the foot and ankle segment, one of the highest growth specialties in musculoskeletal care. Together, we will drive innovation at scale and leverage the power of Paragon 28's dedicated foot and ankle commercial channel to help advance our Mission to alleviate pain and improve the quality of life for people around the world.”

The transaction enhances Zimmer Biomet’s foot and ankle offerings by integrating Paragon 28’s advanced technology platform with Zimmer Biomet’s existing joint replacement and trauma portfolios. The acquisition also creates a dedicated sales channel for foot and ankle solutions, which is expected to accelerate growth both in the U.S. and internationally.

The total deal, first announced January 28, includes $13 per Paragon 28 share in cash, plus a non-tradeable contingent value right worth up to an additional $1 per share if certain revenue milestones are achieved. Paragon 28 is now a wholly owned subsidiary of Zimmer Biomet.

With the deal's closing, Paragon 28 shares ceased trading on the New York Stock Exchange before markets opened on April 21 and will be delisted.

Zimmer Biomet expects the acquisition to bolster its Weighted Average Market Growth Rate and provide access to the fast-expanding ambulatory surgery center market, as the foot and ankle sector—estimated at approximately $5 billion—continues to grow at a high single-digit pace.