Nashville is in line to get another publicly traded health care company thanks to the overhaul of an Indiana medical device company.
Executives at Symmetry Medical (Ticker: SMA) this week announced plans to sell their original equipment manufacturing unit to Tecomet, a private equity-backed company, for $450 million. That deal will be accompanied by the spinning out of its Symmetry Surgical division into a stand-alone public company, giving Middle Tennessee its 14th listed health care enterprise.
Symmetry Surgical is headquartered off Old Hickory Boulevard in Antioch — its distribution hub also is based there — and does business in more than 100 countries. It sells surgical instruments to hospitals, including facilities owned by local titans HCA and Community Health Systems, as well as surgery centers and, according to its execs, holds about 8 percent of the roughly $1 billion reusable medical instrument market. The company was created in its current guise in 2011, when Symmetry Medical bought a unit of Johnson & Johnson for $165 million, and runs manufacturing sites in Louisville as well as Germany and Switzerland.
Symmetry Medical President and CEO Tom Sullivan and CFO Fred Hite will continue to lead the independent Symmetry Surgical, which should be debt free when it begins life as a stand-alone company. They plan to beef up SymSurg’s product portfolio via acquisitions and take the company into other segments of the $10 billion surgical instrument space. Their goal is to reach $250 million in revenues and consistently hit gross margins of 50 percent. In 2013, SymSurg posted adjusted EBITDA of $11.7 million on sales of $89 million.
Sullivan this week told analysts and investors there will be “significant” cost-cutting between now and the completion of the spin-off, which is expected in the fourth quarter. Once those moves are complete, he said, SymSurg will employ less than 200 people.
Some of those workers now work in Fort Wayne at an accounting office. CFO Hite will remain based there along with some other officers and accounting staffers.
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