[Updated 9/22/15, 12:08 pm. See below.] Medical device company TransEnterix has reached across the Atlantic Ocean to acquire the surgical robotics division of Italian company SOFAR in a cash and stock deal valued at $99.8 million.
Research Triangle Park, NC-based based TransEnterix (NYSE: TRXC) has already developed its own robotic surgical system for minimally invasive laparoscopic surgical procedures. The SOFAR deal gives TransEnterix another minimally invasive surgery system, the TELELAP ALF-X, which has regulatory clearance in the European Union. TransEnterix says the two products together will allow it to target a global market. In a conference call this morning to discuss the transaction, TransEnterix CEO Todd Pope said that SOFAR approached the company seeking a partner that shared the same vision of how surgical robotics can grow in the future. [This paragraph has been updated with comments from the conference call.]
“We believe we’ve created a disruptive surgical robotics company,” Pope told analysts.
At the close of the acquisition Monday, SOFAR received $68.7 million up front—$25 million in cash and 15.5 million shares of TransEnterix stock, valued at $43.7 million based on the $2.81 closing price last Friday. The stock gives SOFAR a 15.5 percent stake in TransEnterix. SOFAR also stands to gain up to $31.1 million in cash, paid upon achievement of milestones negotiated by the companies. TransEnterix will remain headquartered in North Carolina. With the closing of the deal, SOFAR Chief Executive Andrea Biff joins the TransEnterix board of directors.
Earlier this summer, TransEnterix raised more than $50 million in a stock offering that the company planned to apply toward commercialization of its surgical robotic system, SurgiBot, which is awaiting regulatory clearance from the FDA. TransEnterix says SurgiBot preserves the tactile feel and freedom of movement of manually controlled instruments while also allowing surgeons to operate from the patient’s side, much like traditional surgery. The system contrasts with the da Vinci Surgical System sold by Intuitive Surgical (NASDAQ: ISRG), a much larger robotic system which is controlled from a different part of the operating room, or from a different room altogether. SurgiBot builds on TransEnterix’s first minimally invasive surgical product, the SPIDER Surgical System, which enabled doctors to introduce and operate a number of flexible instruments in the abdomen through a single port—a small incision in the belly button.
Like Surgibot, SOFAR’s ALF-X system is also a minimally invasive surgical system. But unlike TransEnterix’s approach of entering the surgical field through a single port, the ALF-X is a multi-port system. The SOFAR device also has an a camera with eye-tracking software that Pope said is similar to what is used in fighter jets. Anywhere the surgeon looks, the camera will follow. Pope said that capability frees the surgeon from having to manually move the camera, or rely on someone else to do it. He added that both devices were designed to … Next Page »