Aesthetic device manufacturers Cynosure and Palomar Medical Technologies have signed a definitive agreement, pursuant to which Cynosure will acquire Palomar in a cash and stock transaction valued at approximately $294 million. The two companies, which are both based in Massachusetts, report a total combined installed base of more than 20,000 aesthetic laser systems worldwide, with a distribution network that spans more than 100 countries.
“We believe the acquisition of Palomar creates a substantial opportunity to generate profitable, long-term growth for our company and drive value for our stockholders,” said Michael Davin, chairman and CEO of Cynosure. “Combining with Palomar complements our product portfolio and customer base, adding new product and service revenues, strengthening our global distribution network, creating new cross-selling opportunities and enhancing our intellectual property position with the addition of more than 40 patents.”
Palomar shareholders will receive $13.65 per share of Palomar common stock: $6.825 per share in cash and $6.825 per share in Cynosure common stock (subject to adjustment and collar provisions described in the definitive agreement). Cynosure will issue approximately 5.2 million shares in the transaction and fund the approximately $147 million in cash consideration through existing cash balances.
“Our board of directors and management team believe that this transaction makes strategic sense for our company, offers an attractive premium to our shareholders and creates exciting opportunities for our employees,” said Joseph Caruso, chairman, president and CEO of Palomar. “Both companies share the same passion for innovation, and this combination creates a single, unified organization that is positioned for continued success.”
Upon completion of the transaction, Davin will serve as chairman and CEO; Caruso will join Cynosure's board of directors as vice chairman and will serve as president; and Timothy Baker will serve as EVP, COO and CFO. Cynosure ultimately plans to relocate its headquarters from Westford, Massachusetts to Palomar's owned facility 15 miles away in Burlington, Massachusetts.
“We look forward to welcoming the Palomar team to Cynosure,” Davin said. “We envision a smooth transition and integration that will achieve the full operational and financial benefits of this combination for our customers, employees and shareholders.”