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Zimmer to acquire the orthopedic computer navigation company ORTHOsoft

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Zimmer Holdings has entered into a an agreement to acquire ORTHOsoft Inc., a developer and marketer of medical software, instruments and computerized systems for use during hip, knee and spine implant surgeries.

Zimmer announced it will acquire all of ORTHOsoft's outstanding common shares in a cash transaction for approximately $1.05 per share. Excluding the 12.4% of outstanding ORTHOsoft common stock currently held by a Zimmer subsidiary, the total transaction would be valued at approximately $47.58 million, according to a Zimmer press release.

Zimmer plans to fund the transaction using its operating cash flow and expects it to be completed in the fourth quarter of this year.

"We look forward to welcoming ORTHOsoft's leadership team and skilled employees to the Zimmer family," David Dvorak, Zimmer president and CEO, said in the release.

"This acquisition will support our SmartTools strategic initiative and will allow us to vertically integrate our Zimmer Computer Assisted Solutions (CAS) efforts, enabling us to direct future development and to apply CAS concepts across our various businesses," he noted in the release.

"This acquisition will allow [ORTHOsoft] to concentrate on specific applications for Zimmer products and provide outstanding universal orthopedic navigation solutions," Louis-Philippe Amiot, MD, ORTHOsoft's chairman, CEO and founder, said in the release.

According to the release, Zimmer intends to maintain ORTHOsoft's current operations in Montreal and will integrate the company with its existing CAS organization.

ORTHOsoft's board has unanimously recommended that its shareholders accept Zimmer's offer.

The price of $1.05 per share represents a premium of approximately 69% over the closing share price on the TSX Venture Exchange on August 23 and approximately 66% based on the 20-day average closing price.

ORTHOsoft's products include the Navitrack Navigation System for total knee arthroplasty (TKA) and total hip arthroplasty (THA) and the Navitrack FluoroSpine System for positioning pedicle screws.