Poly Medicure (531768) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition provides entry into the fast-growing global orthopaedic trauma and extremity segment, a resilient $12 billion market expected to reach $16 billion, leveraging a differentiated, MDR-certified and patented product portfolio with strong positions in Italy, Mexico, and a growing U.S. presence.

• The deal aligns with a strategy to expand into high-growth medical device segments, leveraging CTFE as a platform for global orthopedic expansion and accelerating growth in developed markets.

• Integrated business model from R&D to distribution enables agile product development, rapid market entry, and strengthens innovation pipeline.

• Direct sales presence in Italy, USA, and Mexico, with strong market positions in Italy and Mexico, supports global expansion ambitions.

• Citieffe's strong R&D and patented portfolio align with the acquirer's mission to deliver innovative, patient-centric technologies.

Financial terms and conditions

• 100% equity acquired for €18.8 million, with €4.2 million shareholder loan repayment, totaling €23 million payout at closing; €8.1 million net external debt assumed, valuing the company at €31 million enterprise value (EV/EBITDA 10.2x FY24).

• CTFE/Citieffe reported €17.3 million revenue and €3.1 million EBITDA in 2024, with gross margins exceeding 90% and YoY growth of 15% and 14%, respectively.

• Net block stands at €5 million, with total historical investment around $30 million.

• Funded by internal accruals and cash balances.

Synergies and expected cost savings

• Immediate synergy from adding plates and joint replacement to the product portfolio, enabling participation in more public tenders and entry into new markets.

• Potential to double CTFE's business in five years by leveraging distribution networks and expanding into new geographies.

• Outsourcing manufacturing to India expected to reduce costs, improve margins, and build a direct sales unit for CTFE products in India.

• Synergies expected from integrating distribution networks and local manufacturing to enhance competitiveness and lower costs.

• Expansion of distribution in markets where CTFE currently lacks presence.