10/15/20 Update: Stryker entered a definitive agreement with Colfax Corporate / DJO Global for the divestiture of Stryker's STAR total ankle replacement line and related products as well as finger joint replacement products.
In an amendment to its tender offer to purchase Wright Medical, Stryker proposed DJO Global as a buyer for its Scandinavian Total Ankle Replacement (STAR) line as well as certain finger joint replacement assets. The potential for anti-trust regulatory issues immediately emerged after Stryker announced its intent to acquire Wright Medical, given the considerable overlap between the lower extremity portfolios of the two companies.
The U.K.’s Competition and Markets Authority (CMA) announced at the end of June 2020 that Stryker’s acquisition of Wright Medical would result in a substantial lessening of competition (SLC) in U.K. total ankle replacement markets. However, per a recent announcement, the CMA accepted Stryker’s proposed divestment to DJO as a satisfactory resolution to the SLC issue.
Analysts from Jefferies estimated the worth of the STAR product line between $20 million and $30 million. Per ORTHOWORLD estimates, DJO’s extremity joint replacement business generated $190 million in 2019 through shoulder and elbow products. That segment declined -16.4% in the first half of 2020 due to COVID-19. The inclusion of STAR would meaningfully expand DJO’s portfolio and geographic footprint.