Case Studies
MedTech Group
Background
The MedTech Group is a contract manufacturer of medical devices with operations in New Jersey, Connecticut, Puerto Rico, and Costa Rica. Products are manufactured for large medical device manufacturers like Tyco (US Surgical), Stryker, Medtronic, as well as innovative venture backed companies.
The Opportunity
Following their peers in the telecom equipment industry, medical device companies were increasingly trying to outsource the manufacture of their products, and fulfillment functions. In an effort to serve the growing needs of these companies, and their often highly complex products, MedTech began to add various supply chain capabilities (from engineering design through final assembly) via a mix of internal growth, joint ventures, and acquisitions.
Joint Venture & Acquisition Strategy
MedTech Design LLC
Transition of a device from the concept stage to the manufacturing process frequently required design engineers capable of anticipating potential production issues. To integrate this capability into its production process, MedTech developed a joint venture with Synectic Engineering Inc. a Milford, CT based design and development firm.
In order to work together a design firm needs to adopt a longer-term view while the manufacturer needs to be more cognizant of what motivates the designer. Conexus Capital Advisors was able to help establish an equity structure and contractual relationships that addressed these differences and set the appropriate incentives for both parties to allocate important resources toward the venture.MedMold, Inc.
In 2001, MedTech bought the business of Colony Mold, Inc., a highly respected precision mold maker / engineering company. Integration of in-house mold making operations allowed MedTech to add additional expertise, and was overwhelmingly endorsed by MedTech's core customers. Despite the industry's trend toward off-shore production of molds, MedTech was able to double the sales of its mold making operations and significantly increase the number of tooling engineers within one year of the acquisition.
MedTech Automation, Inc.
In 2002, MedTech acquired AUTO-Tek, Co., an automation business based in West Haven, CT. AUTO-Tek's primary focus was on wire cutting and the filling of surgical stapler cartridges - a highly specialized, value added process. Within the first year of the acquisition, MedTech was able to significantly increase sales volumes among major medical device customers. The acquisition also allowed MedTech to integrate the skills required to build high volume automation machines both for its own manufacturing processes as well for its customers.