ConMed announces acquisition amid improved Q1 earnings

ConMed Corp. (NYSE: CNMD), a medical-device manufacturer with roots in the Utica area, announced Wednesday that it has agreed to acquire a Memphis, Tennessee–based firm for $145 million.

Memphis-based In2Bones Global, Inc., develops, manufactures, and distributes medical devices such as implants, fracture systems, biologics, and related hardware for the treatment of disorders and injuries to the hand, wrist, elbow, foot, and ankle.

ConMed will purchase In2Bones in a cash deal that includes up to an additional $110 million in growth-based earnout payments over a four-year period. The sale is subject to regulatory approval and expected to close late in the second quarter or early in the third quarter of this year.

“This acquisition is a natural strategic extension of our orthopedic portfolio,” ConMed President and CEO Curt R. Hartman said in the acquisition announcement. “In2Bones is an exciting platform for ConMed to enter the extremities market given its broad portfolio, extensive sales channel, and experienced leadership team. We look forward to welcoming the In2Bones team to ConMed.”

In 2021, In2Bones generated revenue of $36.8 million and expects to produce double-digit revenue growth in the future. ConMed expects the acquisition will add about $20 million to its revenue and between 5 and 10 cents in earnings per share in the second half of this year.

The acquisition news came in conjunction with ConMed’s first-quarter earnings report. The company generated sales of $242.3 million for the quarter, an increase of 4.1 percent from the same period last year.

Net income in the first quarter was $14.98 million, up 52 percent from $9.86 million in 2021. Earnings per share also increased 52 percent from 31 cents to 47 cents.

“I am pleased with our start to the year as we generated momentum and finished the quarter on a strong note,” Hartman said. “While we are facing larger than anticipated inflationary pressures, we remain confident in our longer-term prospects for both top and bottom-line growth.”

Based on the results, ConMed raised its revenue guidance for the full year from between $1.075 billion and $1.125 billion to the range of $1.105 billion to $1.150 billion. This new guidance reflects the anticipated $20 million revenue impact from the In2Bones acquisition.

Sullivan & Cromwell LLP and DLA Piper LLP are acting as legal counsel for ConMed. William Blair is the exclusive financial advisor and K&L Gates LLP and Nilson Law Group, PLLC are acting as legal counsel for In2Bones.

ConMed manufactures surgical devices and equipment for minimally invasive procedures for surgical areas including orthopedics, general surgery, gynecology, neurosurgery, thoracic surgery, and gastroenterology. The company moved its corporate headquarters from 525 French Road in New Hartford to Largo, Florida in 2021. It maintains manufacturing, finance, human resources, legal, and other corporate functions at the New Hartford facility.