Medical device maker Misonix Inc. has agreed to be acquired by a North Carolina maker of bone graft and joint pain products in a $518 million deal, the companies announced.
Farmingdale-based Misonix manufactures and markets ultrasonic devices used by neurosurgeons and orthopedic surgeons to sculpt bones and remove tumors.
The agreement, announced Thursday, calls for Bioventus Inc., based in Durham, North Carolina, to give Misonix shareholders $28 in cash for each Misonix share they hold or 1.6839 shares of Bioventus common stock.
Misonix shareholders will own about 25% of the combined company.
The deal was approved by the boards of directors of Misonix and Bioventus, but still is subject to approval by stockholders of both companies. The acquisition is expected to close in the fourth quarter of this year.
Misonix chief financial officer Joe Dwyer said that the company has 275 employees overall and plans call for operations to remain in Farmingdale, the base for 85 of those workers.
The acquisition "should be good for shareholders and good for employees, too," he said. "The plan is to keep everything on Long Island for the near-to-medium term."
Dwyer said Misonix is "still in hiring mode" and plans to add 60 additional employees.
After the transaction's close, Misonix CEO and board member Stavros Vizirgianakis and Patrick Beyer, another Misonix board member, will be added as members of the Bioventus board of directors, the companies announced.
"We believe this combination will create value for our shareholders as the combined organization continues to drive innovation and increase physician demand," Vizirgianakis said in a statement.
Dwyer said he and Vizirgianakis plan to step down from their operational roles once the transaction is complete.
Bioventus makes bone graft substitutes, ultrasonic bone healing equipment and joint pain therapies.
In a research note, Alexander Nowak, an analyst at Craig-Hallum Capital Group LLC, said that the deal offers a "strong strategic fit," but that Misonix could have fetched a higher premium given its product pipeline and prospects as the company emerges from the pandemic.
Shares of Misonix climbed 11.3% to close Friday at $26.54, while Bioventus stock tumbled 9.6% to $15.59.
After the close of the transaction, the combined company is expected to operate under the Bioventus name, the companies said.
"We believe this acquisition will accelerate our growth opportunities, enhance our double-digit revenue growth, and provide a significant opportunity for long-term margin expansion," Ken Reali, chief executive of Bioventus said in a statement.
Vizirgianakis and two other major Misonix stockholders, SV Health Investors and 1315 Capital, have agreed to vote in favor of the transaction.
Perella Weinberg Partners LP acted as lead financial adviser to Bioventus, while J.P. Morgan Securities LLC was the exclusive financial adviser for Misonix.
Misonix was among the Long Island companies to receive federal Paycheck Protection Program loans.