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Market Overview

Stryker to Buy Small Bone Innovations for Up To $357 Million Cash


Stryker Corporation (NYSE: SYK)
announced today a definitive agreement to acquire assets of Small Bone
Innovations, Inc. ("SBi") in an all cash transaction for up to $375
million. The net cost to Stryker after taking into account the present
value of the tax benefits as a result of the asset purchase structure
will be up to $285 million. Founded in 2004, SBi is a privately held
business headquartered in Morrisville, Pennsylvania with facilities in
France and Germany. SBi products are designed and promoted for upper and
lower extremity small bone indications, with a focus on small joint

The assets to be acquired include the Scandinavian Total Ankle
Replacement System (STAR Ankle). The STAR Ankle, sold globally in over
40 countries, is the only PMA approved, cementless, three-piece total
ankle replacement system and is the most published total ankle
replacement product in the world. With the addition of the STAR Ankle to
the Stryker Foot & Ankle product portfolio, Stryker comprehensively
addresses the broad range of foot and ankle procedures. Additional
assets include finger, wrist, and elbow products, further expanding the
existing Stryker upper extremity product offerings. The sales of the
acquired products were approximately $48 million in 2013.

"The addition of the STAR Ankle strengthens our product offering in this
fast growing business, and demonstrates our continued commitment to
growth in this segment and more broadly in extremities," said David
Floyd, Group President, Orthopaedics. "We are dedicated to providing our
Foot & Ankle customers and their patients with a complete set of
solutions for their clinical needs."

The transaction is subject to customary closing conditions including the
expiration or termination of the Hart-Scott-Rodino Antitrust
Improvements Act waiting period. Upon closing, the transaction is
expected to be $0.02 dilutive to Stryker's 2014 earnings per share
excluding acquisition, integration-related and intangible amortization
charges. The transaction is expected to close in the third quarter of


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