SNN Issued a Statement Re: BMET Acquisition Rumors
BY HUYEN NGUYEN, NOVEMBER 2, 2006
This morning Smith & Nephew issued a statement confirming speculations that it has been speaking with Biomet. The Company stated that it, "it has held very preliminary talks with the US medical devices company, Biomet Inc. No agreement has been reached, and there can be no assurance that any transaction will be proposed or completed." The Company will not comment further at this time.
Biomet, however, responded to the rumor by stating that it "has had a preliminary discussion with Smith & Nephew plc..., Biomet has not made a determination that it is in Biomet's best interests for it to engage in a transaction with any third party."
Assuming if this acquisition does occur, SNN, whose current market capitalization is at $9.1 billion combined with Biomet whose current market capitalization is $9.2 billion will elevate the company to the #2 position in the orthopedic market, behind Stryker, which stands at $21.1 billion. We briefly explore the following financials of the combined operations in comparison to its competitors:
* Market Cap is indicated for entire business, including non-orthopedic divisions
Source: Company Reports, Capital IQ
Since this morning's announcement, SNN's stock price moved slightly down by 3%, trading at $46.67 while Biomet's stock was up slightly to $38.28. SNN also reported their 3Q:06 financials this morning with sales of $679 million and net of $97 million (as adjusted) for the quarter.
