Tornier IPO could offer windfall to Split Rock Partners ’ and Medtronic?

Medtronic Inc. hasn’t had much luck of late with orthopedics, particularly its spine business. But if Tornier Inc.’s planned $205 million initial public offering comes to fruition, the country’s largest medical device maker is looking at a huge pay day.

The Bakken Research Center (BRC) in Maastricht, Netherlands, home to Medtronic’s R&D operations in Europe, owns 2.8 million shares of Tornier stock, according to documents filed with the Securities and Exchange Commission. Also, in exchange for a $22.1 million loan in April 2009, Tornier granted BRC warrants to purchase 4.4 million shares at $5.66 a pop.

Split Rock Partners, an early stage venture capital firm in Eden Prairie, Minn., owns 271,920 shares. The firm’s $633, 213 loan netted it warrants to buy 126,413 shares at $5.66 a pop.

Tornier could be Split Rock’s second orthopedic coup in as many years. The company was an investor in Spine-Tech, acquired by Sulzer Medica for nearly $600 million in 1998 and now the spine division of Zimmer Medical, a major orthopedic company based in Warsaw, Ind.

Until Tornier’s investment bankers establish a firm IPO price, we won’t know how much money is coming to Medtronic and Split Rock. But given Tornier’s target raise of $205 million, I think it’s safe to say it will be more than $5.66 a share.