Advanced Medical Solutions takeover of Peters gets French approval

27th Jun 2024 16:20

(Sharecast News) - Advanced Medical Solutions announced on Thursday that it has received regulatory approval for its acquisition of Peters Surgical.

The AIM-traded firm said the go-ahead followed the French Foreign Direct Investment screening process, and would allow the transaction to proceed as planned.

It said the acquisition of Peters Surgical, a prominent European provider of specialty surgical products, would significantly bolster its position in the tissue repair and wound closure market.

With the addition, AMS said its consolidated surgical revenue for the 2023 financial year would have nearly doubled, making up almost 80% of its total revenue.

The board said it expected the transaction to lead to high single-digit earnings accretion starting in the 2025 period, excluding substantial anticipated commercial and operational synergies.

Detailed information on the potential synergies would be provided in September, following the completion of the integration project plan.

Peters Surgical reported revenue of €84m for the 12 months ended 31 December 2023.

The transaction was set to be completed on 1 July, triggering an initial cash payment of €132.5m (£113.2m).

Additionally, an earnout of up to €8.9m could be payable in the 2025 financial year, contingent on the delivery of US suture 510(k) approvals, achieving 2024 revenue and gross margin targets, and meeting specified inventory and tax conditions outlined in the initial announcement on 13 March.

"We are delighted to have secured regulatory approval for this transformational acquisition," said chief executive officer Chris Meredith.

"In anticipation of completion, we have been working closely with Peters Surgical to begin an extensive integration project, with a dedicated team now in place to manage the process which has confirmed our view of the quality of the Peters Surgical business, its complementarity with AMS's existing offering, as well as the enthusiasm and commitment of its staff.

"This transaction is a substantial step forward for AMS as we establish an enhanced portfolio of own-branded products, strengthen our direct sales capabilities and look to secure greater global traction in key markets."

At 1536 BST, shares in Advanced Medical Solutions Group were up 1.89% at 216p.

Reporting by Josh White for Sharecast.com.