Henry Schein reached an agreement to acquire a 60 percent interest in BioHorizons, a U.S.-based manufacturer of advanced dental implants sold internationally. Under the agreement, BioHorizons, with revenue of approximately $115 million, will continue to operate as an independent company. The financial terms of the proposed transaction were not disclosed. The transaction with BioHorizons entails a recapitalization, through which Henry Schein will lend approximately $145 million to BioHorizons to fund, among others, a distribution to shareholders before closing, followed by the equity investment. Pending regulatory approval, Henry Schein expects to complete the transaction by the end of the year.
The agreement with BioHorizons strengthens Henry Schein’s position in a critical and growing market, alongside the company’s investment in CAMLOG Biotechnologies, a leading manufacturer of implants in Europe. With these two investments, Henry Schein hopes to gain key positions in two of the largest implant markets — the U.S. and Germany — as well as establish a growing presence in the rest of the world.
According to Henry Schein, BioHorizons and CAMLOG, which will each operate independently, are strong brands with unique features and benefits that offer customers a broad range of treatment options. The investment in BioHorizons aims to strengthen Henry Schein’s position and product portfolio in the biologics market too, a critical adjunct to the implant market. Henry Schein offers customers a wide array of the products and services associated with implant dentistry, thereby providing a complete solution for the dental practice.
“Henry Schein’s strategy includes advancing our position in dental specialty markets, an integral part of which is to support those practitioners who perform oral surgery involving implants,” said Stanley M. Bergman, chairman of the board and CEO of Henry Schein. “Implant dentistry is a critical element of the profession’s transition to digital dentistry. More and more abutments for implants are being digitally designed and fabricated, which increase patient comfort and esthetics and reduce patient visits. Customer demand for implants and the associated materials is expected to increase as digital processes are adopted and the dental experience for the patient is enhanced.”
The value of the global implant market is expected to reach approximately $4.2 billion in 2016, up from approximately $3 billion in 2012. In the U.S. and Canada, the market is expected to reach $1.5 billion in 2016, up from approximately $1 billion in 2012.
Based in Birmingham, Ala., BioHorizons employs approximately 325 people and markets its products in 85 markets. Its revenue has been growing by more than 10 percent annually on average, and more than half of that revenue is derived from the U.S. BioHorizons will continue to be led by its president and CEO, Steve Boggan; Todd Strong, executive vice president and chief operating officer; and David Wall, executive vice president and chief financial officer.