Filed by Zimmer Holdings, Inc.
(Commission File No. 001-16407)
Pursuant to Rule 425 under the Securities Act of 1933
Subject Company: LVB Acquisition, Inc.
Commission File No. for Registration Statement
on Form S-4 filed by Zimmer Holdings, Inc.: 333-198380
33rd Annual J.P. Morgan Healthcare Conference
January 13, 2015
David Dvorak President and CEO
Focus on Musculoskeletal Healthcare Leadership
Cautionary Statement Regarding Forward-Looking Statements
This communication contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of forward-looking terms such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “projects,” “assumes,” “guides,” “targets,” “forecasts,” and “seeks” or the negative of such terms or other variations on such terms or comparable terminology. Such forward-looking statements include, but are not limited to, statements about the benefits of the proposed merger between Zimmer and LVB
Acquisition, Inc. (“LVB”), the parent company of Biomet, including future financial and operating results, the combined company’s plans, objectives, expectations and intentions, the expected timing of completion of the transaction and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Zimmer’s management and are subject to significant risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include, but are not limited to: the possibility that the anticipated synergies and other benefits from the proposed merger of Zimmer and LVB will not be realized, or will not be realized within the expected time periods; the inability to obtain regulatory approvals of the merger (including the approval of antitrust authorities necessary to complete the transaction) on the terms desired or anticipated; the timing of such approvals and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the transaction; the risk that a condition to closing the transaction may not be satisfied on a timely basis or at all; the risk that the proposed transaction fails to close for any other reason; the risks and uncertainties related to Zimmer’s ability to successfully integrate the operations, products and employees of Zimmer and Biomet; the effect of the potential disruption of management’s attention from ongoing business operations due to the pending merger; the effect of the announcement of the proposed merger on Zimmer’s and Biomet’s relationships with their respective customers, vendors and lenders and on their respective operating results and businesses generally; risks relating to the value of the Zimmer shares to be issued in the transaction; access to available financing (including financing for the acquisition or refinancing of Zimmer’s or Biomet’s debt) reasonable terms, including the risk that any condition to the closing of the financing committed for the proposed merger and refinancing of Zimmer’s debt is not satisfied; the outcome of any legal proceedings related to the proposed merger; the risks and uncertainties normally incidental to the orthopaedic industry, including price and product competition; the success of the companies’ quality and operational excellence initiatives; changes in customer demand for Zimmer’s or Biomet’s products and services caused by demographic changes or other factors; the impact of healthcare reform measures, including the impact of the U.S. excise tax on medical devices; reductions in reimbursement levels by third-party payors and cost containment efforts of healthcare purchasing organizations; dependence on new product development, technological advances and innovation; shifts in the product category or regional sales mix of Zimmer’s or Biomet’s products and services; supply and prices of raw materials and products; control of costs and expenses; the ability to obtain and maintain adequate intellectual property protection; the ability to form and implement alliances; challenges relating to changes in and compliance with governmental laws and regulations, including regulations of the U.S. Food and
Drug Administration (the “FDA”) and foreign government regulators, such as more stringent requirements for regulatory clearance of products; the ability to remediate matters identified in any inspectional observations or warning letters issued by the FDA; changes in tax obligations arising from tax reform measures or examinations by tax authorities; product liability and intellectual property litigation losses; the ability to retain the independent agents and distributors who market Zimmer’s and Biomet’s products; dependence on a limited number of suppliers for key raw materials and outsourced activities; changes in general industry and market conditions, including domestic and international growth rates and general domestic and international economic conditions, including interest rate and currency exchange rate fluctuations; and the impact of the ongoing economic uncertainty affecting countries in the Euro zone on the ability to collect accounts receivable in affected countries. For a further list and description of such risks and uncertainties, see Zimmer’s periodic reports filed with the
U.S. Securities and Exchange Commission (the “SEC”). Copies of these filings, as well as subsequent filings, are available online at www.sec.gov, www.zimmer.com or on request from Zimmer. Zimmer disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be set forth in its periodic reports. Readers of this communication are cautioned not to place undue reliance on these forward-looking statements, since, while management believes the assumptions on which the forward-looking statements are based are reasonable, there can be no assurance that these forward-looking statements will prove to be accurate. This cautionary statement is applicable to all forward-looking statements contained in this communication. on
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Additional Information and Where to Find It
Zimmer filed with the SEC, and the SEC declared effective on September 29, 2014, a registration statement on Form S-4 that includes a consent solicitation statement of LVB that also constitutes a prospectus of Zimmer. INVESTORS AND SECURITYHOLDERS OF LVB ARE URGED TO READ THE CONSENT SOLICITATION/PROSPECTUS AND OTHER FILINGS MADE WITH THE SEC IN CONNECTION WITH THE MERGER CAREFULLY AND IN THEIR ENTIRETY, BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE MERGER. The registration statement and consent solicitation statement/prospectus and other documents filed by Zimmer with the SEC may be obtained free of charge at the SEC’s website at www.sec.gov or from Zimmer at www.zimmer.com. You may also read and copy any reports, statements and other information filed by Zimmer, LVB and Biomet with the SEC at the SEC public reference room at 100 F Street N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at (800) 732-
0330 or visit the SEC’s website for further information on its public reference room. Certain executive officers and directors of LVB have interests in the proposed transaction that may differ from the interests of stockholders generally, including benefits conferred under retention, severance and change in control arrangements and continuation of director and officer insurance and indemnification.
This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to appropriate registration or qualification under the securities laws of such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
Industry Innovator. Strong Performance Profile.
Annual
Global Impact of EPS(1) growth operating reconstructive Biomet – last five years cash flow market (2) acquisition on 2009–2013 – average last position future EPS(1) five years
10% ~$1.1B #1 Double Digit CAGR Accretive
(1): Adjusted EPS
(2): Reconstructive market of ~$16B includes knees, hips and extremities. Determined based on competitor annual filings, Wall Street equity research and Company estimates.
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A G E N D A
Innovation Driving Growth
Built a global leader
Executing consistent, successful strategy
Pending acquisition – an ideal fit
An exciting future – extending our strategy
Zimmer: A Profile of Leadership
Industry Broad Product
Global Innovator Focus
$204M on R&D in Knees Operations in over 2013, 4.4% of sales Hips 25 countries, sales
Extremities & in over 100
1,000 person
R&D staff Trauma
New platforms in Spine Sales Breakdown core franchises Dental
Surgical & Biologics 2013
Europe Americas 26%
57% 17%
Asia Pacific
Broad Portfolio of Innovative Solutions
Trauma Spine
Extremities
Dental
Joint Preservation / Hips Biologics
iASSIST™
Knees
Surgical
A G E N D A
Innovation Driving Growth
Built a global leader
Executing consistent, successful strategy
Pending acquisition – an ideal fit
An exciting future – extending our strategy
Executing Consistent Strategy
Driving Operating Margin Expansion and Accelerated EPS
Sustainable Operational Disciplined Growth Excellence Capital Allocation
Sustainable Growth
Performance – EPS Growth Key Initiatives
Reported Adjusted • Single-solution provider
7.5% 10%
CAGR CAGR • Personalized medicine
5.75
Joint preservation and $4.43 biologics solutions
$3.94 $3.32
Emerging markets
2009 2013 2009 2013
Operational Excellence
Performance Key Initiatives
SG&A Ratio Improvement
Achieved $290M run rate savings 42.2% 250
Key areas of focus
BPS
– quality and manufacturing optimization 39.7% – strategic sourcing – spans and layers – shared services
2009 2013
Disciplined Capital Allocation
– Last Five Years 2009-2013
Cash Flow from Operations
~$5.6B
Growth Dividends Share Repurchase
Disciplined M&A Paid $132M in Repurchased 65M and capex dividends in 2013, shares, 30% of
Strong balance current yield of ~1% outstanding sheet
A G E N D A
Innovation Driving Growth
Built a global leader
Executing consistent, successful strategy
Pending acquisition – an ideal fit
An exciting future – extending our strategy
Transaction Overview
Zimmer to acquire Biomet for $10.35B in cash and $3B(1) of Zimmer shares
Biomet shareholders to own approximately 16% of combined company
Expect investment grade ratings with quick deleveraging
Closing expected in Q1, 2015 (subject to regulatory approvals)
+
Creates Leading Pure-Play Musculoskeletal Company
Top Musculoskeletal Players
2013 revenue and market share $9.2B
$7.8B
$5.8B $4.62B
$3.2B $3.14B $3.0B
+
Market
21% 17% 13% 10% 7% 7% 7% share:
Source: Zimmer management and company filings
Note: Numbers represent revenue and estimated market share in $45B musculoskeletal industry
Leverage Global Distribution Channels and Cross-Selling Opportunities
Leverage complementary Cross-Sell Example sales channels
– Cross-selling opportunities
Benefit from enhanced scale
– Focus on surgeon specialties Gel-One®
Transform go-to-market capabilities
– Address needs of consolidating delivery networks
Leverage R&D Spend to Accelerate Innovation
2013 R&D Spend Focus: High Growth (Pro Forma) Opportunities
$360M
Broader integrated solutions pre, peri and post-op $204M Intelligent instruments $156M Personalized devices
Value-based solutions for emerging markets
W H Y W E A R E C O N F I D E N T
Record of Successfully Integrating Acquisitions
2014
2013
2012
Beijing Montagne
Medical Device Co. 2010 2013
2007
2012 2003 2010 2004
A G E N D A
Innovation Driving Growth
Built a global leader
Executing consistent, successful strategy
Pending acquisition – an ideal fit
An exciting future – extending our strategy
Our Priorities: Seamless Integration, Accelerated Growth
Growth
2017 + Accelerated Growth 2015—2017
New, innovative
Seamless Integration products
Maintain customer Full cross-sell and support synergy benefits
Retain talent End of sales dis-synergies
Deliver on synergies
2014 Time
I N S U M M A R Y
Innovation Driving Growth
THE PERFORMANCE THE STRATEGY THE MOMENTUM THE GROWTH
Successful, Pending
Built a An Exciting Consistent Acquisition Global Leader Future Strategy – Ideal Fit
Leading Delivers Global leader Clear focus positions – growth Multiple Post integration
Strong – operational advantages growth to
excellence
performance accelerate
– capital allocation
Zimmer
Personal fit renewed life