Oticon Medical is being sold off by Copenhagen-based healthtech parent company Demant to another hearing implant developer. Cochlear, an Australian company, is set to pay 850 million Danish kroner (roughly $120 million) to acquire Oticon. In the two-pronged transaction, 700 million kroner in cash will be handed over upfront upon deal finalization, and the remaining 150 million will be due within 18 months of closing. Expected approval by the relevant authorities should see the deal locked in by the second half of the year.
“Overcoming the challenges of hearing loss – and living with implant technology to alleviate this – is a lifelong journey, and we believe it is best for our patients to continue this journey with Cochlear,” said Oticon Chief Executive Officer Søren Nielsen. “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.” A key takeaway from the deal is Cochlear’s pledge to continue support for the more than 75,000 people already equipped with Oticon hearing implants. As more technologies are added to its portfolio, newly acquired products will also be in play for compatibility capability developments.
The decision from Demant to sell Oticon after over a decade stems from a relative lack of success in the commercially competitive hearing technologies sector. Regardless, since its 2009 founding, Oticon has developed an impressive slate of cochlear implants as well as hearing loss-treating bone conduction implant systems. Now, Demant intends to focus on its hearing aid, hearing care product, and hearing loss diagnostic testing equipment portfolios.