Medtronic Completes $1.7B Acquisition of Mazor Robotics to Advance Robotic Spine Surgery Platform

On December 27, 2018, VCBeat (WeChat Official Account: vcbeat) learned from foreign media reports that medical device giant Medtronic Inc. (NYSE ticker: MDT) had acquired Mazor Robotics Ltd. (NASDAQ ticker: MZOR) and its robotic-assisted surgical platform for $1.7 billion. The acquisition was finalized with the announcement that the first jointly produced product had received approval from the U.S. Food and Drug Administration (FDA).

Last month, Mazor Robotics, headquartered in Caesarea, Israel, announced that its shareholders had voted to approve a transaction with the world’s largest medical device manufacturer, which has held shares in Mazor Robotics since May 2016, at a price of $58.50 per share. In September, the company completed a third investment round of $40 million, bringing the total amount paid by Medtronic for a 10.6% stake in Mazor Robotics to $72 million. Reportedly, Mazor Robotics’ main products include the Mazor X Guidance System and the Renaissance robotic-assisted spinal surgery platform.

Medtronic stated that it plans to integrate its existing spinal technologies with the Mazor robotic system to develop a comprehensive suite for surgical planning, execution, and verification. The company also disclosed that its recently acquired Mazor X Stealth device has received FDA 510(k) clearance. Medtronic indicated that the Mazor X Stealth will integrate Medtronic’s StealthStation software into the Mazor X platform.

“In today’s announcement, Medtronic is bringing the two companies together to accelerate the advancement and adoption of robot-assisted spinal surgery, delivering benefits to patients, physicians, and the broader healthcare system,” said Geoff Martha, Chairman of Restorative Therapies, in his prepared remarks. “This is the latest example of our surgical synergy strategy, which we believe will transform spine care through procedural solutions that integrate implants, biologics, and enabling technologies such as navigation, 3D imaging, robotics, and powered surgical tools.”

“Everything that happens in the operating room depends on the trained medical professionals there, and that will never change. However, Mazor X Stealth provides us with a powerful tool to plan the surgical procedures we want to perform and helps ensure that the surgery is carried out exactly as planned, with a high degree of accuracy,” added Dr. Christopher Good of the Virginia Spine Institute. “Combining multiple modalities—including computerized surgical planning, three-dimensional assessment of spinal anatomy, robotic navigation, and real-time navigational feedback—all integrated into a single platform, creates a synergy that makes my operating room smarter.”

Medtronic stated that the transaction is expected to “modestly” dilute its adjusted earnings per share for fiscal year 2019. Perella Weinberg Partners and Goldman Sachs served as financial advisors to Medtronic, while Meitar Liquornik Geva Leshem Tal and Ropes & Gray acted as legal counsel. J.P. Morgan Securities and Duff & Phelps advised Mazor Robotics, with Kirkland & Ellis and Luchtenstein Levy Wiseman Law serving as its legal counsel.

Medtronic, headquartered in Minneapolis, is the world’s largest medical technology company. It is dedicated to research in biomedical engineering and designs, manufactures, and markets medical devices or instruments that alleviate pain, restore health, and extend life.

Mazor Robotics, headquartered in Caesarea, Israel, is a medical technology company dedicated to the development of products for robotic-assisted spinal surgery.