Zimmer Biomet is taking steps to expand its foot and ankle orthopedics business with a $1.1 billion deal to acquire specialized implant maker Paragon 28.
Paragon 28’s catalog spans products for fracture and trauma fixation procedures in addition to deformity corrections and joint replacements—all exclusively focused on the feet and ankles, a market Zimmer Biomet pegs at around $5 billion.
“This proposed transaction further diversifies Zimmer Biomet’s portfolio outside of core orthopedics and positions us well in one of the highest growth specialized segments in musculoskeletal care, while creating cross-selling opportunities in the rapidly growing [ambulatory surgical center] space,” President and CEO Ivan Tornos said in a statement.
“Paragon 28’s broad and innovative foot and ankle portfolio, robust product pipeline and dedicated and highly trained sales force, combined with Zimmer Biomet’s global reach and capabilities, will uniquely position us to address the unmet patient needs of this highly complex anatomy,” Tornos added.
Earlier this month, Paragon 28 posted preliminary earnings results for 2024 reporting revenues around $256 million, for about an 18.3% gain over the year prior.
The acquisition includes an upfront payment of $13 for each of the Colorado-based company’s shares plus up to an extra $1 per share if Paragon 28’s product sales can top $346 million during Zimmer Biomet’s 2026 fiscal year. The deal is slated to close before the end of June.
“Joining Zimmer Biomet is an exciting new chapter for Paragon 28 and an incredible opportunity to advance our mission and continue to deliver groundbreaking solutions in the foot and ankle segment,” said Paragon 28 Chairman and CEO Albert DaCosta.
Zimmer Biomet has scheduled its full-year 2024 and fourth-quarter earnings release for Feb. 6.