We are advising Smith+Nephew on the acquisition

Davis Polk is advising Smith+Nephew on its acquisition of CartiHeal. Under the terms of the agreement, Smith+Nephew will pay an initial cash consideration of $180 million, and up to a further $150 million contingent on financial performance. The transaction is expected to close in the first quarter of 2024.

Founded in Hull, United Kingdom, in 1856, Smith+Nephew is a portfolio medical technology business focused on the repair, regeneration and replacement of soft and hard tissue. The company designs, manufactures and markets orthopedic devices, sports medicine and arthroscopic technologies and wound-care solutions. Smith+Nephew now operates in more than 100 countries and generated annual sales of $5.2 billion in 2022.

Founded in 2009, CartiHeal is a privately held medical device company headquartered in Israel and New Jersey, developing proprietary implants for the treatment of cartilage and osteochondral defects in traumatic and osteoarthritic joints. It is the developer of Agili-C, a novel sports medicine technology for cartilage regeneration in the knee. It is indicated to treat a wide patient population, including those with lesions in knees with mild to moderate osteoarthritis, a previously unaddressed condition, as well as the approximately 700,000 patients that receive cartilage repair annually in the United States.

The Davis Polk corporate team includes partner Harold Birnbaum and associates Steven Jaffe and Shuhan Zhang. Partner David R. Bauer and associate Adrian Rabin are providing intellectual property advice. The tax team includes partner Michael Mollerus and associate Dmitry Dobrovolskiy. Partner Veronica M. Wissel and associate Chloe Wang are providing executive compensation advice. Partner Jesse Solomon is providing antitrust and competition advice. Members of the Davis Polk team are based in the New York and Washington DC offices.