Dentsply International and Sirona Dental Systems announced a merger of the two companies on September 15. The resulting company will be called Dentsply Sirona and have an equity value of approximately $13.3 billion, based on the closing prices on September 14.
The merger, which is expected to close in the first quarter of 2016, will create one of the largest manufacturers of professional dental products and technologies in the world, according to the companies.
While the New York Times reported a price of $5.5 billion on the transaction, some details of the merger have been released. It will be an all-stock merger "of equals," according to a press release. Current Sirona shareholders will receive 1.8142 shares of Dentsply for each existing Sirona share. When the transaction closes, Dentsply shareholders will own 58% of the combined company and Sirona shareholders will own 42%.
In an email interview with DrBicuspid.com, Dentsply's corporate communications manager, Meghan Smith, said the emerging company will be "well-positioned to deliver digital technologies and integrated solutions to enhance efficiency and patient care for general practitioners, dental laboratories, and specialists."
"The combination also will create a company better positioned than either company would be on its own to drive the industry's adoption of digital dentistry and integrated solutions to improve patient care," she said.
In their press releases, both companies stated that the merger will yield "end-to-end" solutions for dental professionals. Dentsply Sirona will have established brands in consumables (preventive, restorative, and prosthetics), specialties (endodontics, implants, and orthodontics), and equipment (CAD/CAM, imaging, treatment centers, and instruments).
"Our companies bring unique complementary strengths to meet their needs," Smith stated. "Working together, they can better develop solutions to meet the needs of doctors and patients."
She noted, however, that until the transaction receives the necessary approvals, the two companies will continue to do business separately. As a result, it is "business as usual," according to Smith, for dentists who currently use Dentsply and Sirona products.
Ironing out the details
When the transaction closes, Jeffrey Slovin, president and CEO of Sirona, will serve as CEO and a member of the board of directors of the combined company, and Bret Wise, chairman and CEO of Dentsply, will serve as executive chairman.
"Combining Sirona's proven digital solutions and equipment with Dentsply's leading consumables platform creates the most comprehensive dental solutions offering available to meet customer demand in every key segment," Slovin stated in a press release. "I look forward to leading the talented teams of both Sirona and Dentsply as we drive the global digitization of dentistry, offer superior solutions to customers and patients, and create the dental solutions company."
With the impending merger, net revenues for the combined company will be approximately $3.8 billion with adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of more than $900 million, according to the companies. It will also have one of the largest sales and service infrastructure in dentistry, employing 15,000 people worldwide.
"Strategically, this is a clear win for dentistry, shareholders, employees, dentists, and patients," Smith said. "The future of dentistry is about providing total solutions across the spectrum of treatments for the patient, and there is no better combination than this to meet the future demands and trends in dentistry."