It was announced today that Straumann, the world leader in implant, restorative and regenerative dentistry, has signed an agreement to acquire a 49% stake in Neodent, the leading dental implant company in Brazil, for approximately CHF 260 million in cash. The acquisition will give Straumann the opportunity to gain a leading position in the Brazilian market, the world's second largest for implant dentistry, and to develop its access to additional Latin American markets.
Neodent is a privately held company specialising primarily in the design, development, and manufacture of dental implants and related prosthetic components. Under the entrepreneurial leadership of its founding owners, Drs Geninho Thome and Clemilda de Paula Thome, the company has expanded rapidly over the past ten years and today controls approximately a third of the Brazilian market. This success has been achieved through a philosophy of making tested implant solutions more affordable to a broader population.
"We are extremely proud to become part of the Straumann Group, which we see as the pioneering global leader in implant dentistry. I am convinced that our partnership will contribute significantly to the standard of patient care in South America," said Dr Geninho Thome, co-founder and CEO of Neodent.
With an average growth rate of approximately 20% over the past three years, Neodent achieved sales of BRL 167 million (approx. CHF 80 million) in 2011, which was generated almost entirely in its domestic market. The company is also highly profitable and generated an Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) margin of more than 40%.
"The Neodent brand offers access to a huge market segment that we are less able to address and serve through the Straumann brand alone. With this acquisition and the envisioned dual brand strategy, Straumann can unlock the full potential of the South American markets," said Beat Spalinger, Straumann's President & CEO.
With high liquidity and no debt, Straumann plans on financing the deal of approximately CHF 260 million in cash from existing reserves. This first part of the deal represents a historic EBITDA multiple of approximately 13. The transaction, which is expected to close sometime within the near future, also provides Straumann with the option to increase its stake in two further steps, leading to 100% ownership in six years' time.
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