Shares digital

Shares in investment group MDY Healthcare (MDY:AIM) jumped 10% to 54.5p on the back of a joint acquisition of Middlesex-based Stanmore Implants, an orthopaedic company which specialises in saving and restoring the function of limbs and joints. Together with Abingworth Management, MDY has co-led a syndicated investment of £12.5 million to purchase Stanmore and provide funds for future growth of the business. MDY itself has invested £3 million in the deal, giving it roughly a 20% stake in Stanmore. Brian Steer, ex-chairman of Gyrus Group, which was recently bought out by Olympus, has been appointed as chairman of Stanmore.

Established in 1949, Stanmore designs, manufactures and markets a custom implant service with a portfolio of orthopaedic implants for limb salvage and complex joint replacement. It has a solid presence in the UK and is also rapidly expanding into export markets. The company is headquartered in a specialised facility at the Royal National Orthopaedic Hospital in Stanmore, Middlesex, and holds a small Continental European sales office in France. It is currently owned by University College London. Key to its business is the development of ITAP, a device which directly attaches prosthetic devices to the skeleton of amputees. ITAP is being developed for a range of applications including arms and legs, fingers and cranium and facial prostheses. Over the past three years, a number of craniofacial (involving both the cranium and the face) ITAP devices have been implanted by surgeons and results have been promising. At the end of last year, the first upper limb ITAP device was implanted in a victim of the 7/7 bombings in London.

MDY house broker Brewin Dolphin says the acquisition of Stanmore is ‘a further illustration of the innovative approach MDY is undertaking and the type of opportunities it allows investors to access.’ The broker adds that it is likely that funds injected by the new investors ‘will help accelerate the Marketing Approvals process internationally, and in the US in particular.’ The acquisition is the eighth strategic investment made by MDY. The company previously held a stake in Cozart and realised a juicy £600,000 profit when Cozart was acquired by Concateno (COT:AIM) last year.

Shares says: An acquisition which holds great potential and builds upon MDY’s exposure to a wide portfolio.