ATEC Announces Agreement to Acquire EOS imaging
- Accelerates revenue by creating significant pull-through and cross-selling opportunities via an expanded sales network and combined customer base, including 350+ installed imaging systems
- Advances ATEC’s intraoperative AlphaInformatiX platform and enhances the development of predictive analytics and AI-empowered surgical planning
- Provides international infrastructure foundational to ATEC’s future global re-expansion
- Adds substantial imaging “know-how” to an organization steeped in spine expertise
EOS imaging is a leader in outcome-improving orthopedic medical imaging and software solutions, and is globally recognized for its rapid, low dose, biplanar full-body imaging and 3D modeling capabilities. The EOS technology informs the entire surgical process by capturing a calibrated, full-body image in a standing (weight-bearing) position, enabling precise measurement of anatomical angles and dimensions. The resulting imaging drives a more accurate understanding of patient alignment during diagnosis, elevates the likelihood of surgical goal fulfillment by integrating a fully informed plan into surgery, and enables a post-operative assessment against the original surgical plan.
“This is a monumental transaction for ATEC,” said
“EOS is a fabulous, game-changing technology that has unquestionably improved the treatment of children, adolescents and adults with spinal deformity,” said Dr.
Once closed, the transaction is expected to immediately expand ATEC’s revenue base through the addition of EOS’s revenue run rate, and create significant pull-through and cross-selling opportunities via an expanded sales network and combined customer base. The addition of EOS imaging will advance ATEC’s AlphaInformatiX platform providing capabilities in surgical planning, patient-specific implants, intraoperative alignment reconciliation, and other intraoperative functionalities resulting in a platform distinctively equipped to address the requirements of spine surgery.
The Company expects the acquisition to be accretive to revenue, revenue growth, adjusted EBITDA and free cash flow in the first full year of operations following the transaction close.
With more than 500 scientific articles published in leading journals, EOS’s technology has achieved widespread support and endorsement from the academic community and thought leaders worldwide. EOS’s installed base of over 350 imaging systems encompasses 9 of the top 10 U.S. hospitals, and 20 of the top 251. Additionally, EOS’s well-established international footprint will expedite ATEC’s future ability to enter and penetrate key markets outside of
“We are very enthusiastic about the opportunity to join the complementary strengths and know-how of EOS imaging and ATEC,” said
The Boards of Directors of both ATEC and EOS have approved the execution of a tender offer agreement (the "Tender Offer Agreement"), through which ATEC will launch a tender offer for all of the issued and outstanding shares and convertible notes of EOS imaging for a total purchase price of up to
About EOS imaging
Utilizing advanced predictive analytics, EOS technology is uniquely capable of correlating preoperative and postoperative imaging to assure, from the operating room, the achievement of alignment, the most prognostic factor of long-term successful surgical outcomes. Compared to the conventional spine-imaging modalities, X-Ray and CT, the EOS systems significantly reduce radiation doses and exam times, producing unstitched, full-body, biplanar, high-quality images at lower cost.
Key Features of the EOS imaging Portfolio
- Standing full-body assessment. Head to toe biplanar exams in the weight-bearing position for accurate assessment of factors causing pain and disability to better guide treatment and surgical decisions. Surgical planning from a standing position enables alignment parameters that more closely match functional posture.
- Reduced radiation exposure. Driven by the ALARA* principle, the EOS or EOSedge exam delivers a minimal dose of radiation to reduce the long term impact of repeated imaging.
- Precise 3D measurements. Patient-specific measurements, dimensions and angles to make informed clinical decisions at all stages of care.
- EOSapps and EOSlink for surgical planning and OR integration. Pre-operative planning software to anticipate surgical results and select components for spine surgery; pairs with surgical technologies for precise execution with EOSlink
EOS has imaging systems installed in more than 30 countries generating more than 1 million patient exams annually. Listed on the Euronext Paris Exchange, EOS has corporate locations in the
Key Terms of the Transaction
Under the terms of the Offer, EOS's shareholders would receive either EUR €2.80 (or approximately USD
The Cash Offer price represents a premium of 64% based on the closing price of EOS shares on
The Exchange Offer ratio reflects a premium of 67% on EOS' closing share price on
The Exchange Offer reflects a premium of 53%, 41%, and 64% calculated using the volume-weighted average share prices of EOS and ATEC over the last one, three and six month(s), respectively and the EUR to USD exchange rate as of market close on
Each EOS shareholder will be entitled to elect between the Cash Offer and the Exchange Offer, subject to adjustments that will ensure that, in the aggregate, the number of common shares issued by ATEC shall not exceed 20% of ATEC's current outstanding shares of common stock (or approximately 12.5 million shares based upon the current number of shares of common stock outstanding).
Holders of approximately 23% of EOS’s outstanding common shares have entered into agreements to tender for ATEC shares under the Exchange Offer, representing approximately EUR €17.4 million (or approximately USD
The Offer will also target all outstanding EOS convertible notes (“EOS OCEANE”, or the “Notes”). The holders of the Notes would receive either EUR €7.01 (or approximately USD
It is expected that the Offer will be filed with the
ATEC has entered into a commitment letter with
"We are pleased to be partnering with ATEC on this transformative transaction," said
ATEC paid Perceptive a fee of
Borrowings under the Perceptive facility are subject to customary conditions for committed facilities, including, among others, the consummation of the EOS acquisition without material changes, payment of fees and expenses, issuance of applicable fees upon draws, entry into definitive documentation reflecting the terms of the Perceptive commitment letter, and no material adverse effect with respect to EOS.
Additional details regarding the Tender Offer Agreement and Perceptive commitment can be found in ATEC’s Current Report on Form 8-K to be filed with the
Cowen is acting as financial advisor to ATEC, and
The Company will host conference call on
Founded in 1999 and based in
Forward Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainty. Such statements are based on management's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The Company cautions investors that there can be no assurance that actual results will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors. Forward-looking statements include, but are not limited to, statements about the timing of the anticipated acquisition, when and whether the anticipated acquisition ultimately will close, the expectation that certain existing EOS shareholders will tender in the Exchange Offer, the potential benefits and synergies of the anticipated acquisition, including the expected impact on future financial and operating results, post-acquisition plans and intentions, and plans to obtain financing pursuant to the Perceptive commitment and the uses therefrom. The forward-looking statements contained herein are based on the current expectations and assumptions of the Company and not on historical facts. The following important factors, among others, could cause actual results to differ materially from those set forth in the forward-looking statements: uncertainties as to the timing of the Offer and the closing of the acquisition; uncertainties as to the percentage of EOS’s securityholders tendering their shares in the Offer; the possibility that competing offers will be made; risks related to the AMF‘S review of the Offer; the satisfaction of conditions to closing the Offer and completing the acquisition; the satisfaction of conditions, including applicable regulatory clearances, set forth in the EOS shareholder agreements to tender for ATEC shares, which if not met, could increase the Cash Offer price; the occurrence of any event, change or other circumstance that could give rise to the termination of the Tender Offer Agreement; the effect of the announcement of the Offer and related transactions on the ability of the parties to retain and hire key personnel, maintain relationships with their customers and suppliers, and maintain their operating results and business generally; the inability to reach a 90% threshold in the Offer which would result in EOS continuing to be traded on Euronext and related regulatory requirements in connection therewith; the inability of the Company to secure the financing contemplated to be obtained pursuant to the Perceptive commitment on the expected terms or timing, or at all, whether as a result of failure to meet certain conditions or otherwise; risks related to potential litigation in connection with the Offer or the closing that may result in significant costs of defense, indemnification and liability; the risk that the businesses will not be integrated successfully; unexpected variations in market growth and demand for the combined company’s products and technologies; and the risk that benefits and synergies from the acquisition may not be fully realized or may take longer to realize than expected. The words “believe,” “will,” “should,” “expect,” “intend,” “estimate,” “look forward” and “anticipate,” variations of such words and similar expressions identify forward-looking statements, but their absence does not mean that a statement is not a forward-looking statement. A further list and description of these and other factors, risks and uncertainties can be found in the Company's most recent annual report, and any subsequent quarterly and current reports, filed with the Securities and Exchange Commission. ATEC disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law.
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EOS is incorporated in
Chief Financial Officer
Source: Alphatec Holdings, Inc.