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Acquisition Combines NN, Inc. and MW Industries' Orthopedic Portfolios

MW Industries announced that its Medical Solutions portfolio will combine with NN Life Sciences, creating MW Industries Life Sciences. Affiliates of American Securities, of which MW Industries is a portfolio company, purchased NN Life Sciences for $825 million, including $755 million in cash and an additional $70 million earnout based on 2022 performance.

The transaction is slated for close in 4Q20, at which time Toby Buck will be appointed President of MW Industries Life Sciences. Mr. Buck previously served as CEO and Chairman of Paragon Medical, which was acquired by NN, Inc. in 2018.

In welcoming NN Life Sciences, MW Industries CEO Simon Newman said, “At a time when businesses in the medical sector are under more pressure than ever, we can offer an unbeatable combination of speed, quality, and supply chain resilience. It means our customers can focus on the urgent business of improving people’s lives, safe in the knowledge that they have the components they need, precisely when and where they need them. We are also excited for our plans to have Toby return to lead this business.”

MW Industries Seeks Scale Through Acquisitions

MW Industries provides highly engineered springs, specialty fasteners, bellows and precision components to a dozen markets. Headquartered in Rosemont, Illinois, the company has sought to build its medical and orthopedic business through multiple acquisitions in recent years. The purchases of LaVezzi Precision (2018) and Marox and Sussex Wire (2019) have allowed the company to expand its engineering and machining capabilities as well as its portfolio of implant and instrument manufacturing.

Combining with NN Life Sciences is by far the most notable strategic move, as it allows MW Industries to expedite scale of its capabilities, geographic reach and revenue.

NN Life Sciences’ core capabilities include design and development, precision metal stamping, welding, machining, additive manufacturing, cleanroom packaging and labeling. The company brings specialized instrument and case and tray expertise to MW Industries, as well as expanded insight into implantable components and specialty products. Further, NN Life Sciences expands MW Industries’ operational footprint outside of the U.S. to China, Poland and Switzerland.

Like MW Industries, NN Life Sciences portfolio covers medical contract manufacturing beyond orthopedics. NN Life Sciences reported revenue of $359.7 million in 2019. ORTHOWORLD estimated NN Life Sciences’ 2019 orthopedic revenue at $208 million, which positioned the company as the sixth-largest contract manufacturer in the orthopedic space.

While MW Industries would not disclose revenue information, we estimate that the NN acquisition more than doubles the size of MW Industries’ medical division.

A Better Fit for NN Life Sciences?

The 2018 acquisition of PMG Intermediate Holding Corporation, Paragon Medical’s parent company, accelerated NN’s rank and recognition in orthopedics. The purchase allowed NN to not only establish a presence in orthopedics, but afforded it a listing as a top 10 contract manufacturer in orthopedics. At the time of the acquisition, NN leadership noted that medical was an attractive market for expansion due to higher returns than its other core businesses like auto, aerospace and electrical.

NN’s life sciences business outperformed its other units in 2018 and 2019. However, the company has faced hurdles which were compounded by COVID-19, and remains committed to its original industries. In the last two years, NN accrued significant debt and saw executive changes, including the company CEO and leader of the Life Sciences business. NN plans to use $700 million from the sale to pay down its debt, strengthen its balance sheet and refocus its efforts on its power and mobile solutions.

What to Look for Next

Like most of the industry’s largest contract manufacturers, MW Industries is an amalgamation of dozens of brands. And just like with NN, the acquisition positions a lesser-known company as a major orthopedic contract manufacturer alongside established names like Tecomet, Orchid Orthopedic Solutions and Avalign Technologies.

Maintaining a top position in orthopedics will likely require the company to lean on the human expertise gained from its recent acquisitions. The hiring of orthopedic veteran Toby Buck to lead the new group demonstrates MW Industries’ commitment to the combined companies.



Carolyn LaWell
is ORTHOWORLD's Chief Content Officer.