Companion Spine, a French-American specialist in spine pain management, has finalized a definitive agreement to acquire assets from Xtant Medical Holdings for $19.2 million. This acquisition includes the Coflex Interlaminar Stabilization device and the CoFix Posterior MIS fusion system, along with Paradigm Spine’s business and assets. The transaction is expected to enhance Companion Spine’s ability to address spine pain through innovative treatments for lumbar and cervical conditions.
The deal comprises $11 million in cash upon closing and an additional $8.2 million in short-term seller financing. Xtant Medical plans to use the funds to reduce its long-term debt and improve cash liquidity. The transaction is anticipated to close in the third quarter of 2024, contingent upon Companion Spine securing financing and meeting standard closing conditions.
As part of the agreement, Companion Spine has already made a non-refundable cash deposit of $2.5 million. Should they require more time to finalize financing, the company may make up to two additional deposits of the same amount. At or before closing, Companion Spine will also pay an additional $8.5 million, along with an $8.2 million unsecured promissory note.
Strategic Growth in Spine Treatment
The Coflex and CoFix systems have been marketed by Paradigm Spine in the United States for over a decade and internationally for two decades. Headquartered in Germany, Paradigm Spine is committed to designing, developing, marketing, and distributing spine implant solutions aimed at treating spine pain-related disorders. This acquisition positions Companion Spine as the first sole source provider of a complete range of indication-specific products for dynamic stabilization and motion preservation implants.
Sean Browne, CEO and President of Xtant Medical, stated, “This transaction is a significant step for us as we focus on our core business – the development of higher-margin, best-in-class orthobiologics – while also strengthening our balance sheet and streamlining our operations.” He expressed confidence in the Viscogliosi Brothers, who own Companion Spine, emphasizing their successful track record in the neuro-musculoskeletal field.
The Viscogliosi Brothers’ investment company specializes in the neuro-musculoskeletal industry, and Companion Spine’s acquisition of these assets is expected to enable broader treatment options for spine-related conditions.
In 2023, Xtant Medical completed an acquisition of the Coflex and CoFix product portfolio from Surgalign Holdings for $17 million. This strategic move reflects Xtant’s commitment to enhancing its offerings while focusing on core business activities.
The involvement of a range of advisory firms underscores the complexity of this transaction. Companion Spine is supported by Dorsey & Whitney as lead legal counsel, with McDermott Will & Emery handling tax and German legal matters, and Farber providing intellectual property legal counsel. Meanwhile, Fox Rothschild served as legal counsel for Xtant, and LifeSci Partners acted as the investor relations advisor.
This acquisition not only aims to bolster Companion Spine’s product portfolio but also addresses the growing demand for effective solutions in the spine pain management sector. As the healthcare landscape evolves, such strategic moves are essential for companies seeking to remain competitive and innovative in a challenging marketplace.
