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September 25,Enovis Corporation, a large American orthopedic device company, announced that it has agreed to acquire LimaCorporate for 800 million euros (approximately 850 million US dollars, or 6.2 billion Chinese yuan).The latter is one of the top ten global orthopedic device companies, focusing on digital innovation and the R&D customization of orthopedic implants. It once acquired Zimmer Biomet's knee and elbow system businesses in certain regions.

Enovis' predecessor was Colfax.Once acquired DJO, a giant in the orthopedic industry, for $3.15 billion, marking the fifth-largest acquisition in the medical technology sector that year. In 2022, after divesting its chemical business, the company was renamed Enovis Corporation.Ranked 56th in the Top 100 Medical Device Companies in 2022.

This acquisition will complement Enovis' orthopedic product portfolio, expand its international business footprint, and generate approximately $1 billion in implant revenue, with about 50% of the income coming from the rapidly growing extremities trauma market.

Affected by the news,Enovis (NASDAQ: ENOV) share price increased by 4.86% on the day, reaching $54.16 per share. As of September 27, its market value was $2.884 billion (approximately RMB 21 billion).

As one of the top ten orthopedic device companies, LimaCorporate (Lima Medical) already holds a pivotal market position in the global orthopedic joint market.The company is dedicated to artificial joint reconstruction, focusing on the primary and revision replacement of hip, knee, shoulder, and elbow joints, as well as providing comprehensive customer-specific solutions.The product range covers from large joint revisions, primary implants, to complete limb solutions including fixation.In 2022, the company achieved revenue of 249 million euros (approximately 1.921 billion yuan).

The history of Lima began in 1945 in the town of Anduins, Italy.To address the shortage of surgical instruments after World War II, entrepreneur Carlo Leopoldo Lualdi began producing surgical instruments, and "LIMA" is an abbreviation for Lualdi Industrie Meccaniche Anduins.

With a passion for innovation and precision engineering, the company has achieved significant growth in orthopedics, aerospace, and automotive technologies since its inception.In 2000, Lima Corporate began focusing on orthopedic business and has since become a professional orthopedic device company. In 2002, the company launched the world's first platform-based artificial shoulder joint system, SMR, which is a representative product in the field of artificial shoulder joints.

SMR Artificial Shoulder Joint System

SMR Artificial Shoulder Joint System

The SMR artificial shoulder joint system has obvious technical advantages. Its modular design provides doctors with the possibility to choose the best surgical plan based on the patient's clinical symptoms, thereby achieving better stability while restoring the range of motion of the shoulder joint.The SMR Reverse Shoulder System is the world's first reverse shoulder arthroplasty system to receive an ODEP 10A rating. Based on ODEP's stringent data quality evaluation criteria, the 10A rating is awarded to implants with a 10-year survival rate of no less than 90%.

3D Printed Implant Trabecular Titanium

Acetabular Cup Implants Manufactured with Trabecular Titanium Technology

Subsequently, Lima introduced 3D printing technology in the production process of joint prostheses, becoming one of the pioneers in additive manufacturing.And uniquely created Trabecular Titanium (TT Titanium Trabecular Bone), whose implant surface features a porous structure. Unlike surface coatings manufactured through processes like plasma spraying, this structure is a bionic structure directly produced by 3D printing equipment, allowing precise control over the geometry of the pores. For instance, the acetabular cup implant manufactured using Trabecular Titanium technology has a porosity of 65% and an average pore size of 640 μm.The porous implant structures created by metal 3D printing technology can promote bone ingrowth, leading to better rehabilitation outcomes.

Layout Digital Platform

Last year, the company also launched the Smart SPACE 3D Virtual Planner and Shoulder Cubit Guidance digital platforms.This digital platform is powered by an artificial intelligence algorithm developed by TechMah Medical, allowing surgeons to create comprehensive preoperative plans and execute them using patient-specific 3D locators combined with the sensor technology of the Cubit Guidance System. It provides real-time feedback on instrument and implant positioning while maintaining the operating room and patient setup required by surgeons.

Acquisition and Being Acquired

It is worth noting that,At the end of 2015, private equity firm EQT acquired LimaCorporate by purchasing the majority of its shares.Since then, the two parties have jointly made several investments to consolidate their core businesses, including the acquisition of Zimmer Biomet's knee and elbow systems in the European, Swiss, and Japanese markets in 2016, as well as the acquisition of Biomet’s Vanguard Complete Knee System in Denmark and Sweden, enhancing the company's competitiveness in the extremity joints sector.

Enovis also values Lima's product portfolio and market penetration. After the acquisition is completed, the company will continue to bring critical innovations to surgeons and patients as part of Enovis.

Enovis Corporation, formerly known as Colfax Corporation, was founded in 1995.In 2022, Colfax spun off its welding business into an independent company "ESAB", and it also renamed itself as Enovis Corporation to focus on the medical business.Currently, the company has two major business units under its umbrella:Prevention and Rehabilitation ("P&R") and Reconstruction ("Recon")The prevention and rehabilitation department, as the main business, generates the majority of the company's revenue.

The financial report shows,Enovis Corporation's revenue for the first two fiscal quarters of 2023 was $834 million, an increase of 8.3% year-over-year.Prevention and rehabilitation achieved revenue of 5.23 billion U.S. dollars, increasing by 3.1% year-on-year; reconstruction business achieved revenue of 3.1 billion U.S. dollars, increasing by 18.5% year-on-year.In 2022, Enovis achieved a full-year revenue of $1.6 billion, representing a 10% year-over-year increase.

It is worth mentioning that,The founders of the company are the two brothers, Steven Rales and Mitchell Rales, who previously established Danaher Corporation.The two transformed Danaher from a diversified manufacturing conglomerate into a leading technology innovation enterprise with a market value exceeding $100 billion.Therefore, Colfax continued Danaher's "tradition" of acquiring outstanding companies, and its business has always been built on a series of acquisitions and organic growth.

Cross-Border Betting on the Healthcare Track

In 2019, Colfax made a significant investment — a $3.15 billion acquisition of DJO, then the sixth-ranked company in the orthopedics field, betting on the medical device track.The company has a very comprehensive product chain of sports and rehabilitation equipment, covering the protection and rehabilitation of more than 10 parts of the human body. These include walking braces, foot & ankle braces, post-operative braces, knee ligament braces, osteoarthritis braces, fully customized braces, patellar braces, shoulder & elbow braces, hand & wrist braces, cold therapy systems, and deep vein thrombosis solutions, with a market share as high as 46%.

This transaction became the largest acquisition in Colfax's acquisition history and the fifth-largest acquisition in the healthcare sector for that year.It was this bold attempt that created a new medical technology platform for the company, providing Colfax with a significant growth runway aligned with global healthcare trends.

Divest Welding Business, Focus on Orthopedic Market

In 2022, Colfax spun off its welding business into an independent company "ESAB", and it also renamed itself as Enovis Corporation to better focus on its core medical business.In the following year, Enovis made several more acquisitions, further enhancing its orthopedic product portfolio.

In July 2022, Enovis acquired Insight Medical, a medical technology company specializing in orthopedic surgical navigation.The company's flagship product, ARVIS® , is the only FDA-approved AR solution specifically designed to meet the unique needs of hip and knee replacement surgeries. Enovis integrates these technologies into its own AR glasses product.

In April 2023, Enovis acquired Novastep, a subsidiary of Amplitude Surgical SA.The company's portfolio of forefoot and midfoot implants with CE mark, along with a strong OUS channel, can further solidify Enovis' position in the global foot and ankle market.

In May 2023, Enovis acquired DNE's Seal external fixation product line, further expanding its product portfolio.This is an external ankle fixation frame that assists in the treatment of foot and ankle deformities, fractures, and fusions. The product received FDA approval shortly before its acquisition and is used for routine surgical fixation of the forefoot and hindfoot.

Nowadays, Enovis has absorbed LimaCorporate's products and surgical navigation assistance technology through the acquisition of LimaCorporate.Thereby gaining broader international influence and further expanding its share in the global orthopedic medical market.

The company expects,Lima Corporate is expected to generate sales of $290 million to $300 million in 2024.Adjusted EBITDA is $70 million to $75 million.Based on this estimate, after the acquisition is completed, the company's reconstruction business revenue will surpass the prevention and rehabilitation business unit. At that time, the company's performance may break through the one billion dollar mark.The global orthopedic market ranking will also be reshuffled, and器械之家 will continue to monitor the situation.

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