An animated version of Mazor Robotics' Mazor X system.
(photo credit: PR)
Caesarea-based Mazor Robotics will be acquired by Ireland’s Medtronic plc in a deal worth approximately $1.64 billion, the companies have announced.
The deal represents the largest sale or “exit” of an Israeli medical company to date, surpassing the $1.1 billion acquisition of NeuroDerm by Mitsubishi Tanabe Pharma in 2017.
Founded in 2001, Mazor Robotics has pioneered the application of robotics technology and guidance for use in spinal procedures.
The company is the holder of more than 50 patents worldwide, and its 200 systems have guided the placement of more than 250,000 implants during 40,000 spinal operations.
The acquisition builds upon a multi-phased strategic and equity investment agreement reached by the companies in May 2016, with Medtronic previously holding a stake of 11% of Mazor shares.
In August 2017, Medtronic became the sole worldwide distributor of the Mazor X robotic guidance system.
Medtronic will now acquire all outstanding ordinary shares of Mazor for $58.50 (NIS 207.07) per American Depository Share, or $29.25 (NIS 104.80) per ordinary share, in cash, for a total of $1.64 billion, or $1.34 billion net of Medtronic’s existing stake in Mazor and cash acquired.
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Shares in Mazor Robotics rose by 4.9% to $52.75 at the Nasdaq Stock Market when the deal was announced on Thursday, with Medtronic’s acquisition thereby constituting a 10.9% premium on the company’s closing price.
The boards of directors of both companies unanimously approved the acquisition, and the deal is expected to be concluded during Medtronic’s third fiscal quarter ending January 25, 2019. Medtronic expects the acquisition will generate a double-digit return on the investment within four years.
“Today is a historic day for spine surgery and a defining event in the market’s evolution, and I want to acknowledge and thank all of those whose contribution and faith have been so critical and impactful to our success,” said Ori Hadomi, CEO of Mazor Robotics.
“We believe robotic-assisted procedures are the future of spine surgery, enhancing surgeons’ abilities to perform complex procedures with greater precision, consistency and control,” said Geoff Martha, executive vice president and president of the Restorative Therapies Group at Medtronic.
“The acquisition of Mazor adds robotic-assisted guidance systems to our expanding portfolio of enabling technologies, and we intend to further cultivate Mazor’s legacy of innovation in surgical robotics with the site and team in Israel as a base for future growth.”
Following the agreement, Medtronic will seek to accelerate and broaden the availability of robotic-assisted surgery systems to benefit greater numbers of patients and healthcare providers.
Science and Technology Minister Ofir Akunis welcomed the announcement in a phone call with Mazor Robotics co-founder Moshe Shoham on Friday.
“This is an outstanding achievement for the company itself and a source of Israeli pride for the entire country,” said Akunis.
“There was a good reason for the Science Ministry making support for the advancement of robotics its top priority, especially among students and teenagers across the country, so that we will have many more companies like Mazor in the future, whose staff stand at the global forefront of innovation, science and technology.”
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