ZimVie closed on a deal to sell its spine business to H.I.G. Capital for $375 million. The business will now be called Highridge Medical.

Omar Ford

April 1, 2024

3 Min Read
human spine
Image Credit: artpartner-images via Getty Images

At a Glance

  • Now that the deal has closed, ZimVie will strictly focus on the dental space.
  • The deal was first announced in December of 2023.
  • Shares of ZimVie were up about 13% on Monday.

ZimVie is officially out of the spine market and is now strictly a player in dental.

Earlier today, the Westminster, CO-based company reported it closed the sale of its spine business to H.I.G. Capital in a deal valued at $375 million. H.I.G. Capital renamed the spine business Highridge Medical.  

The deal was first announced in December of 2023.

More specific terms of the agreement show that ZimVie will receive $375 million in total consideration, comprised of $315 million in cash and $60 million in the form of a promissory note that will accrue interest at a rate of 10% per annum, compounded semi-annually, payable in kind, subject to maturity no later than five and a half years from the deal’s closing.

“The completion of the sale of our Spine business is the culmination of months of partnership with H.I.G. Capital and years of commitment from our global Spine team members; I would like to thank everyone for their immense contributions,” said Vafa Jamali, president & CEO of ZimVie. “I could not be more excited for the future of our company as we continue to invest in differentiated solutions for Dental patients and providers in our most attractive end markets, while optimizing our structure to deliver value for our shareholders.”

Highridge has a portfolio of bone healing therapies and will be led by a team of seasoned executives from the medical device industry. Glen Kashuba will join Highridge as CEO and Rebecca Whitney will continue as president of Highridge. Eric Major, the founder and former CEO of K2M Group Holdings, will serve as executive chairman of the board, and Chris O’Connell, former EVP & Group President at Medtronic and CEO of Waters Corporation, will join the company’s board.

Related:Life After Zimmer Biomet: Why ZimVie Has The "It" Factor

In a release, Whitney said, "We are excited to begin this next chapter with H.I.G. The current management team has made significant progress across the organization, and we are encouraged by the growth opportunities ahead for our business."

Three years ago, Zimmer Biomet said it would spin off ZimVie. Warsaw, IN-based Zimmer Biomet’s announcement came around the time when medical device companies put a pause on M&A and instead focused on spinouts and divestitures.

Initially, there was a lot of buzz and fanfare regarding ZimVie’s separation from Zimmer Biomet, however, the spine and dental company struggled to find its footing post-spin.

About a year ago, Jamali spoke about some of the difficulties the company was enduring in the spine market, according to a Seeking Alpha transcript of a 4Q22 earnings call.

Related:Is ZimVie Going to Be the Breakout Medtech Company of 2022?

"With spine, we were a little bit behind in terms of the portfolio,” Jamali said, according to a Seeking Alpha transcript of the 4Q22 earnings call. “We had some gaps. And frankly, we had some commercial activities that we uncovered through the year that were frankly suboptimal and we need to really perform and manage some of our commercial operations. So, with all that volatility inside spine, we focused on the portfolio.”

The market reacted positively to ZimVie's deal closing with H.I.G. Shares of ZimVie were up about 13% regarding news of the divestiture.

About the Author(s)

Omar Ford

Omar Ford is MD+DI's Editor-in-Chief. You can reach him at [email protected].

 

Sign up for the QMED & MD+DI Daily newsletter.

You May Also Like