The Australian competition watchdog has cleared Ellex Medical Lasers’s $100 million sale of its laser and ultrasound business to Lumibird, with the transaction now expected to be completed as early as this week.
On 1 May, a week after shareholders of ASX-listed Ellex approved the sale at an extraordinary meeting, the Australian Competition and Consumer Commission (ACCC) announced a public review of the acquisition.
Lumibird is a French headquartered technology company whose subsidiary, Quantel Medical, develops lasers and ultrasound machines for ophthalmic procedures. Australian supplier Device Technologies distributes the devices locally.
The ACCC’s investigation focused on the impact on market competition and pricing. Both Lumibird and Ellex’s lasers and ultrasound business overlap in the supply of several instruments.
In its recent decision, the ACCC concluded the proposed acquisition was unlikely to substantially lessen competition in any relevant market.
“Ellex is the clear market leader in a majority of the overlapping products. Lumibird has a much smaller presence in these product categories under its Quantel brand,” the ACCC stated.
“While the proposed acquisition would result in an incremental increase in market concentration, the ACCC noted that competition in the market would not significantly change as a result of the proposed acquisition. Additionally, the ACCC considered that Lumibird would still face competitive constraint from other global competitors in particular product segments post-acquisition.”
The ACCC also found that the overall value of sales and units sold in Australia is relatively low, compared with the global operations of both parties. Finally, it said the sale was unlikely to significantly change the competitive dynamics of the overlapping product segments.
Following the announcement, Ellex released a statement saying that it was “pleased” to report that all remaining conditions under the agreement have been satisfied and the transaction with Lumibird is now unconditional.
“Both parties expect the transaction will be complete on 30 June, 2020 as previously announced to the market,” the company stated.
According to the ACCC, Ellex and Lumibird’s businesses overlapped in several areas, including low energy pulse lasers for glaucoma, high energy photocoagulation lasers for retinal disease, high energy photodisruption lasers for post cataract scar tissue and vitreous floaters and diagnostic ultrasound devices.
Following the deal, Ellex will change its name to Nova Eye Medical and focus on glaucoma with its iTrack therapy. It is assessing product acquisitions to add to its glaucoma portfolio this year. It will also retain its 2RT laser therapy for intermediate age-related macular degeneration.
