Medical Device Maker Biomet files for an IPO

Medical Device Maker Biomet files for an IPO

March 7, 2014

Biomet, a maker of medical devices based in Warsaw, IN, has reportedly filed with U.S. regulators for an IPO nominally valued at $100 million.

Reuters reported the IPO filing, which comes 7 years after the maker of orthopedics was taken private in an $11.4 billion leveraged buyout deal. Goldman Sachs Group, Blackstone Group, KKR & Co. and TPG Capital own 97% of Biomet, according to the report. As of Nov. 30, Biomet still carried $5.9 billion in debt, following that transaction, according to The Wall Street Journal.

The Journal reported in February (sub. req.) that Biomet was talking to bankers about raising up to $1 billion in an IPO. The $100 million figure reported by Reuters and others is a placeholder used to calculate registration fees. The eventual IPO fundraise is likely to be more.

Last year, Biomet was the subject of M&A takeover rumors, with some speculating the company would pursue an IPO as possible leverage in buyout talks. 

Biomet also briefly considered spinning off its dental unit. Then it appeared to head in the opposite direction, diversifying with the October acquisition of Colorado spinal startup Lanx for $150 million. California is hub for new spine device companies.  Acquisition of Lanx has triggered the spine transactions again. Large companies are now looking a low cost spine devices which  have replaced the need for minimally invasive spine surgery. Experts say, surgical outcomes between MIS and open repair are not that different, but the cost is 4 to 6 times conventional treatment.  The outside US market is booming for spine technology and makers of orthopedic companies are looking to purchase spine companies in the US with good technology pre revenue and even pre-FDA.

By January, talk of divestiture appeared to have cooled. The maker of dental implants and hip and knee replacements reported its second-quarter earnings: $4.9 million in profit on $825.7 million in sales--a 4.5% boost to its top line over the year-ago period.

BofA Merrill Lynch, Goldman Sachs and J.P. Morgan are lead underwriters on Biomet's offering, according to Reuters