Saumya Joseph / Nov. 4, 2019
(Reuters) – Medical device maker Stryker Corp (SYK.N) said on Monday it would buy smaller rival Wright Medical Group (WMGI.O) for about $4 billion in cash, to gain access to the fast-growing upper-body joint implants business.
Wright Medical, which recorded sales of $836 million last year, is among the top makers of implants to treat upper-body joint injuries such as in shoulder or wrist, as well as lower body including in foot and ankle.
Wells Fargo analyst Larry Biegelsen said the deal would give Stryker a leading position in the shoulder market, which has been a major gap in the device maker’s orthopedic portfolio.
“Stryker will meaningfully bolster its ability to compete and innovate in the nearly $2 billion global shoulder market,” Chief Executive Officer Kevin Lobo said in a conference call with analysts.
Stryker, however, may have to make some divestments in its ankle implant portfolio to avoid antitrust issues as Wright Medical has a near 70% share of the total ankle replacement market, analyst Biegelsen said.