The Irish medical device maker Medtronic plc (NYSE: MDT) announced two strategic investments on May 18. The first wasn’t an acquisition, but could be a precursor to one. The company agreed to buy 15 next-generation robotic spinal systems from Israel-based Mazor Robotics Ltd. In addition, Medtronic will purchase newly issued securities representing 4% of Mazor’s outstanding shares for $11.9 million, and will have the opportunity to buy another 6%, plus a further 5%, in future allotments.
The two companies together will promote Mazor’s spinal system, which helps surgeons plan and execute surgeries. If the initial phase of the agreement meets expectations by the end of 2017, Medtronic will take over exclusive sales and distribution of the products. And probably buy the company.
Medtronic’s acquisition was Smith & Nephew‘s (NYSE: SNN) gynecology business for $350 million. The primary product is the Truclear System, which is a medical technology platform used to remove abnormal uterine tissue such as fibroids and polyps. The system is a less invasive treatment surgical option that can be performed as an outpatient procedure, and will fit nicely into the company’s Minimally Invasive Therapy portfolio.
According to Smith & Nephew, the gynecology business posted $56 million in revenue in 2015, making a multiple of 6.3x revenue.