Merger and acquisition activity is shaping the broader orthopaedic supply chain base, with contract manufacturers of all sizes transforming in the last decade to keep pace with their scaling device company customers. We’ve identified three M&A trends in this portion of the market—ones that we expect will continue.
Global Scale: Contract manufacturers have focused M&A efforts on geographic expansion to better serve customers globally. In recent years, we’ve watched ex-U.S. companies expand their presence in the U.S., while U.S. companies have purchased facilities in Europe and Asia.
New Capabilities: Contract manufacturers have purchased companies that will allow them to bring in-house new capabilities like additive and coatings or services like design, regulatory or logistics.
Outside Investors: Private equity firms have been behind much of the M&A activity in recent years. We expect new firms to enter this market by supplier acquisitions, and current firms to provide the capital to make additional purchases.
To give a sense of this activity, we’ve listed the contract manufacturer M&A that we’ve tracked from 2017 through 3Q18.
Acquirer | Acquired | Description |
Arcamed | Veracity Medical | Arcamed, a supplier of case and tray systems, expands its capabilities to include contract manufacturing of instruments and implants. |
ARCH Global Precision | Seabrook | Seabrook was acquired by ARCH Global Precision, a family of companies focused on manufacturing precision cutting tools, precision machined industrial components and medical implants and instruments. |
Avalign Technologies | Millennium Surgical | Millennium is a manufacturer of difficult-to-find specialty surgical instruments for orthopaedics and neurosurgery. |
Avalign Technologies | Thortex | This transaction brings Thortex’s capabilities of metal injection molding, precision manufacturing and porous coating solutions for titanium and cobalt-chrome orthopaedic implants. |
Cretex Companies | Quality Tech Services | QTS is a supplier of outsourced packaging for the medical device industry. |
Eurocoating | Nanosurfaces division of CoorsTek Medical | Nanosurfaces, the Italian manufacturing division of CoorsTek, was founded in 2013 as a spin-off of the manufacturing operations of SAMO, one of Europe’s longest-standing orthopaedic OEMs. The acquisition expands Eurocoating’s manufacturing operations and adds surface treatment capabilities. |
Graham Partners (private equity firm) | Medbio | Medbio specializes in precision injection molding, instrument manufacturing, laser processing, packaging and component parts. |
In’Tech Medical | Pyxidis | Manufacturer of customized metal and plastic sterilization cases and trays for surgical instruments. |
In’Tech Medical | Bradshaw Medical | In’Tech bolsters its instrument portfolio and continues its global expansion with this acquisition. Bradshaw has over 40 issued patents for its spinal and orthopaedic instrument portfolio, and provides customizable silicone overmolded solutions. |
Kohlberg & Co. (private equity firm) | Cadence | The acquisition broadens Cadence’s manufacturing capabilities. Kohlberg’s investments include Amendia, a spinal solutions provider that rebranded as Spinal Elements in 2017. |
MedPlast | Integer’s Advanced Surgical & Orthopaedics | Following the purchase, MedPlast rebranded itself as Viant. With the Integer ASO product line acquisition, Viant gains a range of metals manufacturing capabilities (e.g. machining, stamping, coating and metal forming), as well as design, development and prototyping services. |
MedPlast | Vention Medical’s device manufacturing assets | The acquisition broadens MedPlast’s manufacturing capabilities and bolsters its position as a leading services provider to the world’s largest original equipment manufacturers. |
MinebeaMitsumi | C&A Tool | The acquisition expands Minebea’s presence in medical, additive manufacturing, precision machining and ball bearings. |
MW Industries | LaVezzi Precision | LaVezzi Precision, an implant and instrument component manufacturer, joins the MW Medical Solutions brand. MW is a provider of springs, specialty fasteners, machined parts and other precision components. |
NN | Bridgemedica | The acquisition expands NN’s new product design engineering and development capabilities. |
NN | DRT Medical | DRT is a supplier of precision manufactured orthopaedic implants and instruments. |
NN | Paragon Medical | The acquisition, for $375 MM in cash, positions NN as one of the 10 largest contract manufacturers in orthopaedics and supports NN’s strategy to grow its Life Science revenue to $300MM in 2018. Paragon, a Tier-1 manufacturer of implants, instruments, cases and trays, operates seven facilities located in Asia, Europe and the U.S. |
Nordson | Vention Medical’s Advanced Technologies | Vention AT and Nordson Medical share several common customers. The kyphoplasty specialty is just one among Vention AT’s broad base of end markets, complementing Nordson’s orthobiologics delivery solution that includes the OsteoXpress Graft Delivery Device. |
Oberg Medical | X-L Engineering | Oberg is a contract manufacturer of precision metal components, tooling and stamping assemblies. The acquisition provides new and expanded manufacturing capabilities for Oberg as well as additional resources in engineering, new product development and prototyping. |
Röchling Advent Tool & Mold | Precision Medical Products | Röchling is a manufacturer of injection-molded plastic precision components. Precision Medical manufactures products that include syringes for bone cement. The acquisition supports Röchling’s growth strategy in the U.S. |
Sussex Wire | Marox | Sussex Wire, a manufacturer of cold formed components for a variety of industries, acquired Marox, a manufacturer of orthopaedic implants and instruments. |
Tecomet | HD Surgical | The acquisition bolsters Tecomet’s instrument manufacturing and expands its ability to support its mid-size customers. |
TITAN Metal Fabricators | Edge International | TITAN acquired select assets of Edge International, distributor of raw materials used in the manufacture of implants and instruments for the orthopaedic, spine and trauma markets. |
Wytech | Micro-Tube Fabricators | Micro-Tube specializes in precision fabricated tubular components for medical devices and other industrial markets. The combined entities, including recently-acquired Morton Bowen, will provide engineering, manufacturing, assembly and value-added services to medical device OEMs. |
Update, 12/19/18: The original article noted a purchase price of Bradshaw Medical by In’Tech. The figure was removed due to inaccuracy. The transaction details were not made public.
Merger and acquisition activity is shaping the broader orthopaedic supply chain base, with contract manufacturers of all sizes transforming in the last decade to keep pace with their scaling device company customers. We've identified three M&A trends in this portion of the market—ones that we expect will continue.
Global Scale:...
Merger and acquisition activity is shaping the broader orthopaedic supply chain base, with contract manufacturers of all sizes transforming in the last decade to keep pace with their scaling device company customers. We’ve identified three M&A trends in this portion of the market—ones that we expect will continue.
Global Scale: Contract manufacturers have focused M&A efforts on geographic expansion to better serve customers globally. In recent years, we’ve watched ex-U.S. companies expand their presence in the U.S., while U.S. companies have purchased facilities in Europe and Asia.
New Capabilities: Contract manufacturers have purchased companies that will allow them to bring in-house new capabilities like additive and coatings or services like design, regulatory or logistics.
Outside Investors: Private equity firms have been behind much of the M&A activity in recent years. We expect new firms to enter this market by supplier acquisitions, and current firms to provide the capital to make additional purchases.
To give a sense of this activity, we’ve listed the contract manufacturer M&A that we’ve tracked from 2017 through 3Q18.
Acquirer | Acquired | Description |
Arcamed | Veracity Medical | Arcamed, a supplier of case and tray systems, expands its capabilities to include contract manufacturing of instruments and implants. |
ARCH Global Precision | Seabrook | Seabrook was acquired by ARCH Global Precision, a family of companies focused on manufacturing precision cutting tools, precision machined industrial components and medical implants and instruments. |
Avalign Technologies | Millennium Surgical | Millennium is a manufacturer of difficult-to-find specialty surgical instruments for orthopaedics and neurosurgery. |
Avalign Technologies | Thortex | This transaction brings Thortex’s capabilities of metal injection molding, precision manufacturing and porous coating solutions for titanium and cobalt-chrome orthopaedic implants. |
Cretex Companies | Quality Tech Services | QTS is a supplier of outsourced packaging for the medical device industry. |
Eurocoating | Nanosurfaces division of CoorsTek Medical | Nanosurfaces, the Italian manufacturing division of CoorsTek, was founded in 2013 as a spin-off of the manufacturing operations of SAMO, one of Europe’s longest-standing orthopaedic OEMs. The acquisition expands Eurocoating’s manufacturing operations and adds surface treatment capabilities. |
Graham Partners (private equity firm) | Medbio | Medbio specializes in precision injection molding, instrument manufacturing, laser processing, packaging and component parts. |
In’Tech Medical | Pyxidis | Manufacturer of customized metal and plastic sterilization cases and trays for surgical instruments. |
In’Tech Medical | Bradshaw Medical | In’Tech bolsters its instrument portfolio and continues its global expansion with this acquisition. Bradshaw has over 40 issued patents for its spinal and orthopaedic instrument portfolio, and provides customizable silicone overmolded solutions. |
Kohlberg & Co. (private equity firm) | Cadence | The acquisition broadens Cadence’s manufacturing capabilities. Kohlberg’s investments include Amendia, a spinal solutions provider that rebranded as Spinal Elements in 2017. |
MedPlast | Integer’s Advanced Surgical & Orthopaedics | Following the purchase, MedPlast rebranded itself as Viant. With the Integer ASO product line acquisition, Viant gains a range of metals manufacturing capabilities (e.g. machining, stamping, coating and metal forming), as well as design, development and prototyping services. |
MedPlast | Vention Medical’s device manufacturing assets | The acquisition broadens MedPlast’s manufacturing capabilities and bolsters its position as a leading services provider to the world’s largest original equipment manufacturers. |
MinebeaMitsumi | C&A Tool | The acquisition expands Minebea’s presence in medical, additive manufacturing, precision machining and ball bearings. |
MW Industries | LaVezzi Precision | LaVezzi Precision, an implant and instrument component manufacturer, joins the MW Medical Solutions brand. MW is a provider of springs, specialty fasteners, machined parts and other precision components. |
NN | Bridgemedica | The acquisition expands NN’s new product design engineering and development capabilities. |
NN | DRT Medical | DRT is a supplier of precision manufactured orthopaedic implants and instruments. |
NN | Paragon Medical | The acquisition, for $375 MM in cash, positions NN as one of the 10 largest contract manufacturers in orthopaedics and supports NN’s strategy to grow its Life Science revenue to $300MM in 2018. Paragon, a Tier-1 manufacturer of implants, instruments, cases and trays, operates seven facilities located in Asia, Europe and the U.S. |
Nordson | Vention Medical’s Advanced Technologies | Vention AT and Nordson Medical share several common customers. The kyphoplasty specialty is just one among Vention AT’s broad base of end markets, complementing Nordson’s orthobiologics delivery solution that includes the OsteoXpress Graft Delivery Device. |
Oberg Medical | X-L Engineering | Oberg is a contract manufacturer of precision metal components, tooling and stamping assemblies. The acquisition provides new and expanded manufacturing capabilities for Oberg as well as additional resources in engineering, new product development and prototyping. |
Röchling Advent Tool & Mold | Precision Medical Products | Röchling is a manufacturer of injection-molded plastic precision components. Precision Medical manufactures products that include syringes for bone cement. The acquisition supports Röchling’s growth strategy in the U.S. |
Sussex Wire | Marox | Sussex Wire, a manufacturer of cold formed components for a variety of industries, acquired Marox, a manufacturer of orthopaedic implants and instruments. |
Tecomet | HD Surgical | The acquisition bolsters Tecomet’s instrument manufacturing and expands its ability to support its mid-size customers. |
TITAN Metal Fabricators | Edge International | TITAN acquired select assets of Edge International, distributor of raw materials used in the manufacture of implants and instruments for the orthopaedic, spine and trauma markets. |
Wytech | Micro-Tube Fabricators | Micro-Tube specializes in precision fabricated tubular components for medical devices and other industrial markets. The combined entities, including recently-acquired Morton Bowen, will provide engineering, manufacturing, assembly and value-added services to medical device OEMs. |
Update, 12/19/18: The original article noted a purchase price of Bradshaw Medical by In’Tech. The figure was removed due to inaccuracy. The transaction details were not made public.
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JV
Julie Vetalice is ORTHOWORLD's Editorial Assistant. She has covered the orthopedic industry for over 20 years, having joined the company in 1999.