Bulletin: Zimmer Biomet Holdings Inc.'s Proposed Acquisition Of Paragon 28 Inc. Will Enhance Its Portfolio

BOSTON (S&P Global Ratings) Jan. 29, 2025--S&P Global Ratings today said that it expects Zimmer Biomet Holdings Inc.'s (BBB/Stable/--) proposed acquisition of Paragon 28 Inc. for $1.2 billion (including debt) will increase the company's leverage, though we anticipate it will remain consistent with our expectations for the current rating. Therefore, all of our ratings on Zimmer are unchanged. We expect the transaction will close in the first half of 2025. While we expect the proposed acquisition will increase the company's leverage to about 3.0x in 2025 from about 2.5x in 2024, given the negligible initial EBITDA contribution from Paragon and upfront integration costs, this level of leverage is consistent with our previous expectations. Further, we expect Zimmer will maintain cushion

...BOSTON (S&P Global Ratings) Jan. 29, 2025--S&P Global Ratings today said that it expects Zimmer Biomet Holdings Inc.'s (###/Stable/--) proposed acquisition of Paragon 28 Inc. for $1.2 billion (including debt) will increase the company's leverage, though we anticipate it will remain consistent with our expectations for the current rating. Therefore, all of our ratings on Zimmer are unchanged. We expect the transaction will close in the first half of 2025. While we expect the proposed acquisition will increase the company's leverage to about 3.0x in 2025 from about 2.5x in 2024, given the negligible initial EBITDA contribution from Paragon and upfront integration costs, this level of leverage is consistent with our previous expectations. Further, we expect Zimmer will maintain cushion relative to our 3.75x downside trigger. The transaction will expand the company's foot and ankle product offerings and enhance the revenue growth of its S.E.T. segment (which has been expanding by the mid-single-digit...

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