Stryker Corp. (NYSE: SYK) has agreed to buy Gaymar Industries Inc., the medical products maker in Orchard Park, New York, for $150 million in cash.
Founded in 1956 by John K. Whitney in the basement of his Tonawanda, New York, home, Gaymar Industries specializes in support surface, pressure ulcer, and temperature management equipment and supplies for institutions and homes. Gaymar was acquired by private equity firms Nautic Partners and Norwest Equity Partners in 2003.
Stryker has sold Gaymar’s support surface and pressure ulcer management products to acute-care customers in North America for a decade, under an exclusive original equipment manufacturer agreement. The acquisition expands Stryker’s product offerings in this market adds complementary temperature management technologies.
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Based in Kalamazoo, Michigan, Stryker makes medical devices, and medical and surgical equipment. It is perhaps best known for its orthopedic implants. The company last year had worldwide sales of $6.7 billion.
“The acquisition of Gaymar Industries is consistent with our strategic goal of expanding our existing product offering and extensive sales force presence via innovative and value added products,” said Stephen P. MacMillan, Stryker’s chairman, president and chief executive officer, in a press release.
“In addition to a talented team, Gaymar provides our Medical division with an attractive portfolio of high-performance support surface and pressure ulcer management products that target an approximately $1.8 billion worldwide market, while simultaneously enhancing our customer relationships through the addition of their temperature management offering,” MacMillan said.
Gaymar Industries refocused its management and business strategy in early 2009 to ride out the global economic contraction — and drop in hospital spending — that began in late 2008. The company had sales of about $77 million last year — about $14 million was related to its relationship with Stryker.
In March, Gaymar said it would close its Kitchener, Ontario, Canada, facility and consolidate manufacturing and distribution operations in Orchard Park, according to Buffalo Business First. The company has about 200 full-time employees in Western New York, and another 150 in Puerto Rico, the business publication said.
“We are thrilled to become part of Stryker and broaden the availability of our clinically proven products,” said Kent Davies, CEO of Gaymar, in Stryker’s release.
“The integration of our complementary product portfolio will strengthen Stryker’s leadership in patient handling while driving innovations that can help prevent adverse events and reduce healthcare costs,” Davies said. “Through Stryker, we will provide more opportunities to our employees, our customers and the patients that we serve.”
The transaction is expected to close Oct. 1 and add to Stryker’s earnings after 2011.
