On September 15, 2015, DENTSPLY International Inc. (“DENTSPLY”) (NASDAQ: XRAY), one of the world’s largest manufacturers of consumable dental products for the professional dental market, and Sirona Dental Systems Inc. (“Sirona”) (NASDAQ: SIRO), a global dental technology leader, announced that the Boards of Directors of both companies unanimously approved a definitive merger agreement to combine the companies in an all-stock merger of equals. This combination created the world’s largest manufacturer of professional dental products and technologies with net revenue of approximately $3.8 billion and adjusted EBITDA of more than $900 million.
Moelis & Company served as the exclusive financial advisor to DENTSPLY and led the company in all aspects of the transaction. Narrowing in on the essential elements unique to this client, Moelis & Company advised on the negotiation of key economic, managerial and social deal terms, post-close capital allocation strategy and messaging of the deal announcement to the Street. Under the terms of the agreement, Sirona shareholders received 1.8142 shares of DENTSPLY for each existing Sirona share, reflecting an “at market” exchange ratio. At closing on February 29, 2016, DENTSPLY shareholders owned 58% and Sirona shareholders owned 42% of the combined company in a tax-free merger.
The combined company, supported by its leading platforms in consumables, equipment and technology, offers an enhanced set of complementary offerings and end-to-end solutions that will advance patient care. Customers across the globe will now be supported by the largest sales and service infrastructure in the industry to deliver an optimized product range that will meet the increasing global demand for digital dentistry and integrated solutions. In an industry that is increasingly consolidating, the DENTSPLY/Sirona merger represented an opportunity for both companies to gain scale, increase product breadth and increase shareholder value. The transaction is expected to have over $125 million of annual pre-tax synergies by the third year and to be accretive to both sets of shareholders within the first year after close.
The deal builds on Moelis & Company’s track record of delivering differentiated advice to public company boards while maintaining confidentiality. This transaction represents the largest dental transaction in history.