Heerlen, the Netherlands - Royal DSM NV is buying the US-based privately-held biomaterials developer Polymer Technology Group Inc. (PTG) of Berkeley, California. The deal gives DSM, "a leading position in the field of biomedical polymers, one of DSM's future key growth areas," a 28 April statement from the Dutch materials and life-sciences group.
DSM said the acquisition, subject to appropriate regulatory approvals, is expected to be complete in Q2 2008. No financial details were revealed, but the price consists of a payment at closing as well as an "earn-out," payment if certain sales and profit growth targets are reached, said DSM.
The price will be about 10 times PTG's earnings (EBITDA), the group said.
PTG anticipates about $40 million in net sales in 2008, with an "above average" operating profit margin, said DSM. The US operation also expects annual sales growth of more than 20 percent in the next 3-5 years, based on existing business and new products coming forward.
DSM said that the acquisition of PTG - a developer of biomedical polyurethanes and medical devices- is an important step in realising its ambitions in Biomedical Materials, one of its emerging businesses.
The Dutch group said it aims to establish over €100 million ($157 million) in sales by 2012 in biomedical materials, with PTG contributing a significant part.
As both a materials and life-sciences company, DSM "is in a unique position and can combine its abilities in both market segments," for innovative products in healthcare, said the company.
The deal gives DSM Biomedical, "a leading global position in the fast growing biomedical materials market, said Steve Hartig, president DSM Biomedical, in the DSM announcement. "Our collective technology in combination with our expanded geographical and customer base will help us to develop a unique portfolio of products for the medical device industry," he added.
Californian group PTG offers speciality chemicals and polymer-based solutions for critical, material-intensive applications in the medical field, with materials including segmented polyurethanes, polycarbonate urethanes, silicone polyether urethanes and silicone polycarbonate urethanes.
Uses for these materials include pacemakers, neural stimulation leads, contact lenses, orthopedic implants, catheters and implantable sensors. DSM said that PTG's products are widely used by leading medical device companies in both short and long-term devices, several of which have received approval from the US Food and Drug Administration.
The company has three facilities with a total space of about 55 000 sq.ft (5100 sq.m), and employs about 100 people. Bob Ward, one of PTG's founders and a recognised innovator in biomedical materials, will remain as president/ceo of PTG after the acquisition, said DSM.
DSM Biomedical's current portfolio includes a hydrophilic and antimicrobial coating technology for catheters, guidewires and stent delivery systems and polyethylene fibre technology developed specifically for uses such as orthopedic implants. The group also has a focus on developing materials and systems for implantable devices for the musculoskeletal and vascular systems and drug delivery devices in musculoskeletal, vascular and ophthalmic application areas.