LeMaitre Acquires Omniflow II Biologic Graft

LeMaitre Vascular, Inc.

acquired Xenotis, the manufacturer and marketer of the Omniflow II biological graft for peripheral bypass and dialysis access, on August 14th. Total consideration for 100% of Xenotis' shares was $7.7 million, consisting of $5.1 million at the closing, $1.4 million due August 13, 2015 and assumed bank debt of $1.2 million. In its fiscal year ended June 30, 2014, Xenotis broke even on sales of $2.3 million, or approximately $3.4 million if sold through LeMaitre's sales channel. Dave Roberts, LeMaitre's President, noted "The Omniflow II vascular graft is a natural companion to XenoSure, our bovine vascular patch. It has a proven track record with approximately 20,000 implants since 1990. This product should benefit from our vascular-only sales channel, particularly in Europe where Xenotis has used independent distributors. We believe vascular surgeons have begun to associate biological implants with reduced infection, and that there is limited competition in biological grafts outside the US. This transaction follows our strategy of acquiring under-marketed devices and bringing them to more vascular surgeons through our global sales force." Xenotis sold 95% of its products through distributors in its fiscal 2014 and owns regulatory approvals in Europe, Australia, New Zealand, Canada, Brazil and several other international markets. Xenotis manufactures Omniflow II in its own facility in North Melbourne, Victoria, Australia and has 10 full-time employees. LeMaitre acquired the Xenotis building with an appraised value of $1.9mm as part of this $7.7mm transaction. All figures are in $US and based on an exchange rate of A$1.00 = US$0.929. Business Outlook Guidance on how this acquisition may affect LeMaitre Vascular's 2014 revenue and operating income will be provided at the Company's Q3 2014 earnings call.