Demant announces intention to divest Oticon Medical while ensuring lifelong support of existing patients
Oticon Medical’s parent company Demant has decided to discontinue its hearing implants business and therefore has negotiated an agreement with the intention to sell Oticon Medical to Cochlear. The decision follows a thorough review including how to ensure the best lifelong support of existing users. Until the ownership transfers to Cochlear, we remain at the disposition of our customers and users.
Since the introduction of the first Oticon Medical products in 2009, Demant has invested significantly in implantable solutions for the treatment of hearing loss, and the employees of Oticon Medical have worked tirelessly to bring industry-leading technology to thousands of patients. This has resulted in many major milestones along the way. However, Demant has concluded that the prospect of becoming a global leader in hearing implants is not achievable within a reasonable timeframe without disproportionate levels of investments. In this light, Demant has taken the decision to discontinue its efforts in hearing implants.
Best interest of patients and customers
As a result, Demant believes it is in the best interest of Oticon Medical’s patients to sell its Hearing Implants business to Cochlear, which is the global leader in implantable solutions for hearing loss. As part of the intended transaction, Cochlear has committed to continue servicing existing patients of Oticon Medical life-long. Cochlear has committed to seeking to develop products that will be compatible with existing Oticon Medical implants, so a patient will be able to continue to access the new sound processor technology with their existing implant.
Statements from CEOs of Demant and Cochlear
Both Demant and Cochlear announced the agreement today in a release to the stock exchange. In the release, CEO Søren Nielsen of Demant said: “Overcoming the challenges of hearing loss – and living with implant technology to alleviate this – is a life-long journey, and we believe it is best for our patients to continue this journey with Cochlear. We will do everything in our power to ensure minimal implications of the intended divestment for customers and patients as well as the employees of Oticon Medical, who have delivered beyond expectations and are some of the brightest minds in the industry,”
Cochlear’s CEO & President, Dig Howitt added, “We look forward to welcoming Oticon Medical’s entire base of implant customers and patients to the Cochlear family. Driven by our mission to innovate and deliver a lifetime of hearing outcomes, we will seek to ensure that Oticon Medical’s customers and patients continue to be supported with a lifetime of hearing solutions. We will work closely with Demant to ensure a seamless transition of the business to Cochlear to ensure continued access to current Oticon Medical technology for customers and patients in the coming years. We will develop next-generation sound processors and services that will enable customers to transition to and benefit from Cochlear’s technology platform over time. The acquisition of Oticon Medical will provide us with greater scale and will enable us to increase our investments in R&D and market growth activities.”
The intended transaction involves the sale of Oticon Medical, which comprises its cochlear implants (CI) and bone anchored hearing systems (BAHS) product categories. The transaction can only happen if it is approved by relevant authorities, and if it is approved the agreement is expected to become final in the second half-year of 2022.
The process of preparing a transaction of a company from one owner to another is a complex one with many details that need to be settled, including the transaction itself as well as agreements on the future supply of services and/or products.
This transaction is subject to regulatory approvals and other customary closing conditions. The divestment of the business to Cochlear Limited is now expected to close in Q2 (April – June), 2023. Previously, closing was expected to take place at the end of 2022, but the Spanish competition authorities have handed over the case to the European Commission, which will prolong the approval process for the transaction.
All Oticon Medical users will be well taken care of in the future. Please rest assured, at Oticon Medical we will continue to do our utmost to service both professionals and patients in the transition phase. On CI, we will put all our efforts on supporting existing patients with upgrades, accessories, and repairs. On BAHS, we will continue to operate as normal including delivering the newly released Ponto 5 SuperPower. Please contact your usual local Oticon Medical representative for any questions you might have: Contact Oticon Medical
We would like to express a heartfelt thank you for your trust in our company, our products, and our people - and for your dedicated support and collaboration over the years. All Oticon Medical patients will be well taken care of in the future. We remain at your disposition and thank you for your support.
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