Sell-Side Advisory

decosimo corporate finance

About MTG

Based in Arlington, Tennessee, Machining Technology Group, LLP (MTG) is a precision contract manufacturer in the orthopedic medical device industry, providing design, engineering, prototyping, and manufacturing services to orthopedic medical device companies.

About Accellent

Accellent provides comprehensive manufacturing supply chain solutions to a variety of industries. Accellent serves original equipment manufacturers in the medical device industry, providing cardiology, endoscopy, drug delivery, neurology, and orthopedic manufacturing services and products.

Client Objectives

MTG’s owners engaged DCF professionals to value the company for general corporate planning, including updating their key man life insurance.

Maximizing Value

While delivering our valuation, we presented the idea of a private equity recapitalization both to achieve personal liquidity and diversification. This recapitalization would also best position MTG to meet the demands of a soaring market for spinal devices.

Disciplined Process

Having received Indications of Interest from several financial and strategic buyers, we arranged visits with the top prospects. After helping MTG’s owners weigh the pros and cons of either a strategic or financial transaction, they selected Accellent, a major company in MTG’s industry. Our professionals negotiated a transaction price that more than doubled management’s original expectations.

Proven Results

In addition to receiving cash and Accellent preferred stock, the owners gained key positions at Accellent, provided job security and professional growth opportunities for MTG’s employees, and positioned MTG as a key component of Accellent’s plans to rapidly grow its orthopedic division.

After the transaction, Accellent announced that it had agreed to be acquired for $1.27 billion by Kohlberg Kravis Roberts & Co., one world’s oldest and most experienced private equity firms. This subsequent transaction would further enhance Accellent’s strength and increase the value of the MTG owners’ preferred stock by 50%.

Click here for a pdf version of this case study or here to view DCF’s medical device experience.

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