Cochlear is a leading Australian MedTech company and develops and markets cochlear implants system for the treatment of profound deafness. Cochlear’s net sales totalled AUD 285.8 million (EUR 170.2 million or SEK 1,540) in 2004. The company is listed on the Australian Stock Exchange.
”We are very pleased with Entific’s development during our five-year investment period,” states Senior Partner Jan Lundahl, Head of CapMan Life Science. ”Today Entific is a globally successful company that has grown rapidly and profitably. With Cochlear as the new owner, the company will be an even stronger industrial player with exceptionally good preconditions to continue successful business development. We believe that the sale of Entific to an esteemed trade buyer such as Cochlear is an excellent outcome for both the company and its personnel.”
”The deal represents a perfect match and will give Entific a new larger platform to work from. It is a good solution for all the parties involved. Entific and Cochlear are complementary both from a company culture and product development point of view, but even more so as regards sales and marketing. The products of Entific and Cochlear target the same customer base and are sold to the same clinics and surgeons”, says Mr. Per Carendi, Chairman of the Board of Entific.
During the five years that Entific has been owned by CapMan’s Swedestart II Fund, Investor Growth Capita and Nobel Biocare, Entific has developed into a well established company with currently over 25,000 patients treated with the Baha® hearing implant. The bone anchored hearing implant, made of titanium, gives a unique possibility for ENT- and neurosurgeons throughout the world to treat Single Sided Deaf patients or patients with a conductive hearing loss who will regain a functioning hearing and hence be able to live a normal life. The treatment involves fairly non-invasive surgery. Under the leadership of Dan Pitulia, CEO, the turnover has increased six-fold since 1999 attributable to the establishment of an international sales and marketing organization in combination with a high pace of new product launches. The FDA clearance for Baha as a treatment option for Single Sided Deafness late 2002 has since been a major driving force for growth. The US has now become the most important market for Entific.
”Entific is a success story. The company has developed into a fantastic MedTech company with an average sales growth rate of 36% per annum, positive cash flow and good profitability. From a position as a non-core business unit within Nobel Biocare, Entific is today an international company with a strong foothold in a very attractive growth area with sales and marketing in the USA and the major European markets,” says Per Carendi.
Swedestart II Fund, which is managed/advised by CapMan, invested in Entific in 1999 and the increase in value of the investment is 6.3 times money back. Prior to the deal the fund held a 26.6% stake in the company. The exit does not effect on CapMan Plc’s result for 2005 nor does it have any substantial effect on the Group’s result in coming years.
The trade sale of Entific to Cochlear is the latest in a round of good news by CapMan Life Science investment operations. The sale of Swedish NeoPharma AB to Solvay Pharmaceuticals S.A. was finalised in January 2005. NeoPharma has developed the DuoDopa drug delivery system for the treatment of advanced Parkinson’s disease. In December 2004 the Finnish company Inion Oy completed a successful IPO on the Main List of the London Stock Exchange. Inion develops and commercialises biodegradable polymer implants for the treatment of orthopedic fractures.
Carnegie Investment Bank acted as sole advisor for CapMan, Investor Growth Capital and Nobel Biocare in the transaction. The deal is awaiting clearance from relevant anti-competition authorities and is expected to be closed during the first quarter of 2005.
For further information, please contact:
Mr Jan Lundahl, Head of CapMan Life Science, Senior Partner, tel. + 46 8 545 85 475 or +46 708 56 19 53
Mr Yrjö Wichmann, Investment Director, CapMan Life Science, tel. +358 9 6155 8357 or +358 40 5868 979
Mr Per Carendi, Chairman of the Board, Entific Medical Systems, tel. +46 708 11 21 11