Enovis Corporation · NYSE:ENOV
Enovis — Colfax — Merger or Acquisition (November 2018)
21 slides from Enovis's merger presentation, Nov 19, 2018
Slide 1: Acquisition of DJO Global
ACQUISITION OF DJO GLOBAL | November 19, 2018 Exhibit 99.2
Slide 2: Forward-looking statements
The following information may contain forward-looking statements, including forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements concerning Colfax’s plans, objectives, e
Slide 3: Compelling Strategic Transaction
Evolves Colfax to higher margins, faster growth and lower cyclicality, with upside opportunities Non-cyclical, steady revenue growth – ~4% CAGR over past 5 years >55% gross margins and >20% EBITDA margin in 2017 with upside Colfax will use CBS to drive further operating improvement and margin expans
Slide 4: Transaction Details
Consideration Colfax to acquire DJO from Blackstone Group for approximately $3.15 billion in cash Attractive Adjusted EBITDA multiple of 11.7x1 Funded by cash, debt, and equity J.P. Morgan and Credit Suisse providing committed bridge financing Commitment to Balance Sheet Strength Goal to maintain cu
Slide 5: Introducing DJO Global
A passionate commitment “to get and keep people moving” Iconic brands and category defining products Attractive financial performance Industry leading positions Strong demographic and sector drivers Talented and experienced leadership team Introducing DJO Global
Slide 6: DJO's Attractive Financial Profile
DJO’s Attractive Financial Profile 22.3% 2017 Revenue By Product 2017 Revenue By Geography Serving Large & Growing Healthcare Segments Exposure to Global Markets Transformation Driving Margin Expansion Steady, Non-Cyclical Growth ~4% CAGR Adjusted EBITDA (in millions) Revenue (in millions) 21.7% 19.
Slide 7: Iconic Brands and Industry Defining Products
Iconic Brands and Industry Defining Products Custom Knee Braces From elite athletes to weekend warriors, more than 20 years of industry leading protection Removable Braces Pioneer in the space with #1 global market share Surgical Implants Leader in differentiated technology and upper extremity solut
Slide 8: Reconstructive and Prevention & Rehabilitation markets
Reconstructive – ($17 billion market) SURGICAL IMPLANTS: One of the fastest-growing adult reconstructive surgery businesses; launched new reverse shoulder in U.S. which is now the leading product worldwide in its class BONE GROWTH STIMULATION: Technology leader in bone growth stimulation market with
Slide 9: Products & Services Across Continuum of Care
PERFORMANCE PREVENTION SURGICAL RECOVERY REHAB Athletic braces Muscle stimulation Pre-op braces Slings Protective solutions Orthotic shoes Shoulders Knees Hips Bone growth stimulators Post-op braces Bone growth stimulators DVT Cold therapy Traction devices Electrotherapy Heat/cold therapy Products &
Slide 10: Macro Trends Support Sustained Growth
Orthopedic Patient Volume Growth Hip and Knee Moving to Outpatient AGING POPULATION: Rise of diseases and injuries that require surgeries or other orthopedic treatment RISING OBESITY: Increased likelihood of orthopedic injury and need for orthopedic products REDUCTION IN OPIOID USAGE: Shift to utili
Slide 11: Industry Leading Innovation
Pioneering internet-connected smart brace Cloud-based connectivity throughout continuum of care Promotes patient progression, compliance & engagement Robust pipeline of connected product launches Industry Leading Innovation #1 reverse shoulder globally Shoulder revenue increased 20% CAGR (2015-2018)
Slide 12: DJO Consistent with Disciplined M&A Approach
DJO Consistent with Disciplined M&A Approach Focus and Empower Top Talent Acquire Good Companies Use CBS to Make Them Great Attractive markets Strong brands and solutions Opportunities to improve and expand Values Tools & processes Way of working Independent businesses Great leaders, strong teams, w
Slide 13: Colfax/DJO Value Creation Opportunity
Colfax/DJO Value Creation Opportunity Ramp to 4-5% annual growth Improve EBITDA margins >50 bps per year Increase unlevered FCF to $200+ million p.a. by year 3 Achieve Colfax 10% ROIC target by year 5 Finish transformation, embrace CBS culture Fuel strong innovation-driven implants growth Re-invigor
Slide 14: DJO Meets Colfax Acquisition Criteria
DJO Meets Colfax Acquisition Criteria Colfax New Platform Criteria DJO a Clear Fit Steady growth and beneficial secular trends Low cyclicality and volatility #1 in Bracing and Rehab Leading positions across the continuum of orthopedic care >55% gross margins >20% EBITDA margins New product launches
Slide 15: Successfully Reshaping Colfax
Successfully Reshaping Colfax Operational improvement Fluid Handling 2015 2016 2017 2018 2019 DIVEST Pivot to industrial markets EXPLORE STRATEGIC OPTIONS Faster, less cyclical growth Structurally higher margin potential Innovation upside More attractive capital deployment landscape AMI Siemens Turb
Slide 16: Financing and Balance Sheet Overview
Financing Structure Approximately $3.15 billion total consideration to be financed with: $100 million of cash on hand $2.4-$2.7 billion of debt: combination of term loans and senior bonds $500-$700 million of equity or equity-linked securities J.P. Morgan and Credit Suisse providing committed bridge
Slide 17: Capital Allocation Priorities
Capital Allocation Priorities Long-Term Financial Policy Manage leverage to pre-acquisition levels Continue to shape portfolio to create value & minimize volatility Long-term goal to achieve investment grade ratings Committed to reduce debt leverage to mid-3x’s in 2019 Will evaluate de-leveraging op
Slide 18: Compelling Strategic Transaction
Compelling Strategic Transaction Diversifying portfolio with global leader in orthopedic care, uniquely positioned to benefit from demographic and industry trends Executing on our strategy to make portfolio higher margin, faster growth, and less cyclical Expecting significant long-term value creatio
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Slide 20: Non-GAAP Reconciliation (unaudited)
Non-GAAP Reconciliation (unaudited) Colfax has provided in this presentation financial information that has not been prepared in accordance with GAAP, including Adjusted EBITDA for DJO Global. DJO Global provided Colfax with this information, which was derived from DJO Global’s historical unaudited
Slide 21: Non-GAAP Reconciliation (unaudited)
Non-GAAP Reconciliation (unaudited)