Zimmer to purchase Biomet in $13.35 billion deal - Fox 28: South Bend, Elkhart IN News, Weather, Sports

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Zimmer to purchase Biomet in $13.35 billion deal

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Zimmer is buying Biomet in a $13.35 billion deal that will merge the two Warsaw-based medical device firms.

The deal is not expected to be closed until early 2015 but Zimmer is already projecting that it will save them $270 million annually by the third year after the merger is completed, and saw their stock price raise over 9% in premarket trading this morning.

$10.35 billion of the $13.35 billion price tag will be paid in cash, with the other $3 billion paid to Biomet's equity holders in the form of stock. Both companies also say the assumption of an undisclosed amount of debt is factored into the price of the deal.

The resulting combined company will remain in Warsaw, and will be 84% owned by Zimmer stockholders and 16% owned by Biomet stockholders.

Warsaw Mayor Joseph Thallemer said it's natural when there's an acquisition or merger to wonder if you will still have a job.  And it's certainly one people are asking now that Zimmer has announced they are purchasing Biomet.  "Certainly there's duplicity of functions and jobs that will have to be addressed," said Thallemer.

Zimmer Director of Public Relations Jim Gill said that's a question that can't be answered yet.  "It's too early to tell right now what may happen, we're in the very early planning stages."

But he said long term this is not about downsizing.  "This is really all about growth, it's about coming together a greater amount of resources."

Gill said once Zimmer and Biomet combine they will be the second largest medical device company in the industry.  And they plan to keep the manufacturing base in Warsaw and even grow it.  "It's vindication if you will of the talent and the know how that is here."

The Mayor said that's all good news but he'll be keeping a close eye on all of this since it'll impact so many Warsaw residents.  "Having the orthopedic companies here in our community is very good for our community, I think this gives it more strength, but certainly the changes is something that's going to affect people in our community," said Thallemer.


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