Integra Looks to Spin Off Spinal Surgical Business

By Fred Zucker

Integra LifeSciences Holdings Corporation (NASDAQ: IART), a diversified medical technology company focused on surgical and tissue regeneration solutions, recently announced that it would spin off its spinal surgery business into SeaSpine Holdings Corporation in a 10-12B SEC filing. After the spin off, Integra will continue to manufacture specialty surgical, orthopedic, and tissue technology solutions.

“We believe that the spin-off, which will create two distinct companies with separate ownership and management, will enhance value for current Integra stockholders by better positioning each of Integra and SeaSpine to leverage its distinct competitive strengths, management of operations, and capital investments, obtain equity and debt financing and pursue growth strategies,” read the filing.

In 2014, SeaSpine’s reported revenue of $138.7 million, consisting of 48.7% orthobiologics sales and 51.3% spinal fusion hardware sales, and a net loss of $24.5 million. Approximately 10% of the company’s sales were to over 30 international markets with the remainder being domestic U.S. sales.

The company’s orthobiologics division has an 8.6% market share in the U.S. bone graft substitutes market, representing the fourth largest position, according to iData Research Inc. With a dual branding strategy that enables it to market orthobiologics into territories where they do not maintain independent spine sales agents, the company is uniquely positioned to grow its presence over the coming years.

Over time, management hopes to continue scaling the business to increase their market position in orthobiologics and become a leader in the spinal fusion hardware market. Spin offs in general have also been shown to outperform the overall market over the long-run, according to numerous studies, due to a variety of different factors, including institutional treatment of the stock


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