Sullivan & Cromwell has advised U.S. medical supply giant Stryker Corp on its proposed acquisition of Hong Kong’s Trauson Holdings Co, represented by Ashurst, for $764 million.
Hong Kong partner Lina Lee led the team for Ashurst, supported by M&A partner Robert Ogilvy Watson and counsel Jonathan Hsui.
Stryker will pay HK$7.50 ($0.97) for every share of Trauson. The offer is at a premium of about 45 percent to Trauson's closing price on Jan. 8, when the shares were halted on the Hong Kong Stock Exchange.
Founded in China in 1986, orthopedics firm Trauson had sales of about $60 million in 2011 and makes spine devices and products for trauma surgeries.
"With its research and development expertise, manufacturing capabilities and strength of its distribution network, Trauson is a compelling opportunity for Stryker to drive growth in China and other emerging markets for years to come," Stryker CEO, Kevin Lobo, said in a statement.
Stryker, which has a market capitalisation of nearly $23 billion, makes surgical implants, spine devices and various other medical equipment.
Trauson's controlling shareholder, Luna Group, has agreed to tender 61.7 percent of Trauson shares.
Barclays Capital advised Stryker on the deal, which is expected to close by the end of the second quarter. UBS is the exclusive financial adviser to Trauson.
The deal is expected to be neutral to Stryker's 2013 earnings, excluding related charges, and will add them thereafter.
Stryker shares have risen about 12 percent over the last six months and closed at $59.43 on the New York Stock Exchange on Wednesday.
Shares of Trauson have more than doubled over the last year.
“This transaction demonstrates that despite the negative publicity recently associated with a number of publicly listed PRC companies, the Hong Kong public equity market continues to provide opportunities for investors to realise the value associated with solid China-based business,” said Ashurst’s Lee in a statement.
Kanishk Verghese is North Asia journalist at ALB. Follow us on Twitter: @ALB_Magazine.
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