Published: Sun, September 23, 2018
Medical | By Johnnie Horton

Medtronic buys remainder of Mazor Robotics in $1.6B deal

Medtronic buys remainder of Mazor Robotics in $1.6B deal

The agreement, an effort by Medtronic to become a leader in spinal surgery using guided robotics, is the largest amount ever paid for an Israeli company in the medical sector.

The boards of directors of both companies have approved the transaction, and the deal is expected to close by the end of Medtronic's third fiscal quarter, ending January 25, 2019, subject to regulatory clearances and approval by Mazor's shareholders.

Mazor's CEO Uri Hadomi was questioned past year by the Israel Securities Authority on suspicion of using insider information concerning the previous deal with Medtronic, during which he became a shareholder in the company.

Mazor CEO Ori Hadomi was questioned by Israel Securities Authority in connection with an investigation into possible insider trading, based on the company's relationship with Medtronic a year ago.

Founded in 2001, Mazor pioneered the application of robotics technology and guidance for use during spinal procedures.

Shares of Mazor Robotics Ltd - (NASDAQ:MZOR) have been given a consensus rating of "Hold" by the ten analysts that are covering the company, MarketBeat reports. Medtronic intends to offer a fully-integrated procedural solution for surgical planning, execution and confirmation, the Company said in a release.

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The companies plan to showcase their technology integration at the upcoming North American Spine Society annual meeting in Los Angeles next week.

"We believe robotic-assisted procedures are the future of spine surgery, and provide surgeons a more precise, repeatable, and controlled ability to perform complex procedures", said Geoff Martha, executive vice president and president of the Restorative Therapies Group at Medtronic. Dorsey Wright & Associates grew its holdings in shares of Mazor Robotics by 16.9% during the second quarter.

Medtronic said it expects the acquisition "to generate a double-digit return on invested capital by year four, with an increasing contribution thereafter". J.P. Morgan Securities LLC, Duff & Phelps LLC, with Kirkland & Ellis LLP are Mazor's financial advisors in the deal, and Luchtenstein Levy Wiseman Law office acts as its legal advisor. Its products include: Renaissance Surgical Guidance System, which enables surgeons to advance from freehand surgical procedures to guided procedures, as well as Food and Drug Administration (FDA)-cleared and European Conformity (CE)-marked Renaissance System, used in spine surgeries, whether open or minimally invasive, for a number of clinical indications. Mazor Robotics Ltd.is based in Caesarea, Israel.

iMS combines the superior service of Oakworks Medical and advanced manufacturing technology of FAMED Medical Solutions. Medtronic employs more than 86,000 people worldwide, serving physicians, hospitals and patients in more than 150 countries.

Further Reading: How are the companies in the S&P 500 selected? The acquisition is subject to customary closing conditions, including regulatory clearance and Mazor shareholder approval. Actual results may differ materially from anticipated results.

Medtronic was also one of three multinationals in July to have been approved for a grant by the Israel Innovation Authority to expand its R&D centers for biotechnology and medicine in Israel. The issuer of this announcement warrants that they are exclusively responsible for the content, accuracy and originality of the information contained therein.

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