ARTICLE SUMMARY:
While the medical device industry, and orthopedics in particular, isn’t kind to mergers, Enovis’ roll-up—or as it prefers to say, its compounding value creator—strategy in ortho seems to be succeeding, due to disciplined M&A and execution of integration, and support for innovation. Its latest and largest test may be its deal to buy the regional player LimaCorporate for roughly €800 million.
The orthopedics industry isn’t kind to big mergers. The track record is mixed, with Stryker perhaps being an imperfect exception.
In this challenging area, Enovis may have found a strategy for success. While the jury is still out, the company’s rapid ramp through acquisitions—more than 20 in the past five years—isn’t hurting its standing on Wall Street. Its stock price has held up unusually well in a turbulent market following the announcement in September of its plan to buy Italian orthopedics reconstructive company LimaCorporate in a deal valued at roughly €800 million. Earlier this year, it lured high-profile medical device analyst Kyle Rose from Canaccord Genuity to be VP, investor relations. And it has won the respect of orthopedics industry veterans, some of whom now see Enovis as a future partner for their deals.
