Stryker Enters Definitive Agreement to Acquire Mobius Imaging and Cardan Robotics

By Julie A. Vetalice

Stryker Enters Definitive Agreement to Acquire Mobius Imaging and Cardan Robotics

To bolster its spine division, Stryker is acquiring Mobius Imaging and its sister company, Cardan Robotics. The deal is a cash transaction of approximately $370MM up front, along with $130MM in contingent and milestone payments. The acquisition provides Stryker with immediate entry into the intra-operative imaging segment to complement its implant and navigation offerings. The purchase is expected to close in 4Q19.

Mobius Imaging is focused on integrating advanced imaging technologies in the surgical workflow. Their Airo TruCT scanner provides real-time diagnostic quality CT imaging. Cardan Robotics had been developing robotics and navigation systems for surgical and interventional radiology procedures, specifically, the Orion spinal robotic system.

In our 2019 Orthopaedic Industry Annual report, we ranked Stryker as the fourth largest player by revenue in the spine segment with an estimated $781.3MM in revenue for 2018. NuVasive, Stryker and Globus comprise a core of high-growth secondary players in the spine market, all with spine sales growth of +9% or better in 2018 vs. the prior year. All three companies have carried positive momentum for spine sales into the first half of 2019.

As orthopedic sales strategies increasingly focus on end to end solutions instead of single implants, this acquisition serves to give Stryker a more complete array of whole-procedure solutions that cover sales, service and support. While Stryker reinvigorated their spine product offerings with the acquisition of K2M last year, it is clear that they felt the need to be aggressive in transactions to level the playing field with NuVasive and Globus. Such activity also continues a trend of companies purchasing technologies that have already been developed and commercialized.

Sources: Stryker Corporation; ORTHOWORLD estimates

Tags: M&A