HeartWare International, Inc. (Nasdaq: HTWR), has entered into a definitive agreement to acquire privately held company Valtech Cardio Inc. in a share deal, with no cash involved.
Valtech specializes in the development of innovative, non-invasive surgical and transcatheter valve repair and replacement devices for the treatment of the most prevalent heart valve diseases mitral valve regurgitation (MR) and tricuspid valve regurgitation (TR).
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The Israeli startup was founded in 2005 by CEO Amir Gross and Yiftach Beinart in the incubator in Ariel, which is managed by Peregrine. As a technology startup the company received a grant from the Office of the Chief scientist. Peregrine invested too in Valtech. Other investors included OXO Capital Valve Ventures LLC, NGN Biomed Opportunity II LP, as well as other investors. The company has 40 workers and it raised $26 million to date.
Since incorporation Valtech has developed an expansive portfolio of innovative technologies for the treatment of mitral and tricuspid valve disease. Valtech Cardio has full, in-house development, manufacturing, and clinical research capabilities, and over 130 patents and patent applications.
According to the terms of the agreement, Valtech shareholders will receive an up-front consideration of 4.4 million shares of HeartWare common stock; 800, 000 shares of HeartWare common stock, contingent upon CE Mark approval for Cardioband; and 700, 000 shares of HeartWare common stock upon the earlier of first-in-man implants for either Cardioband tricuspid or CardioValve. The transaction also includes warrants to purchase 850, 000 shares of HeartWare common stock at an exercise price of $83.73 per share (based on a volume weighted average price of HeartWare shares) exercisable upon attainment of $75 million in net sales (trailing 12 months) of Valtech products, and an earn-out payment of $375 million (payable in cash or stock, at the discretion of HeartWare), upon attainment of $450 million of net sales (trailing 12 months) of Valtech products.
