IPG Photonics acquires Lumibird Medical for €300M to expand ophthalmology laser business

Source: MarketBeat Read Time: 6 min

Key Points

• IPG Photonics has signed a binding offer to acquire Lumibird Medical for €300 million, plus a potential €50 million earn-out, in a move aimed at expanding its medical laser business.
• The deal would strengthen IPG's exposure to higher-margin medical markets, especially ophthalmology, and raise advanced solutions to about 26% of total sales on 2025 pro forma results, up from 16% currently.
• IPG expects the acquisition to be accretive to gross margin, EBITDA and adjusted EPS in the first year, and it plans to fund the purchase with cash on hand while keeping a strong balance sheet.

IPG Photonics (NASDAQ: IPGP) announced it has signed a binding offer with Lumibird SA to acquire Lumibird Medical, a medical laser systems business focused primarily on ophthalmology. The company said the transaction would expand its exposure to higher-margin medical markets.

On a conference call discussing the proposed acquisition, IPG Chief Executive Officer Mark Gitin described the deal as "an important milestone in IPG's strategic evolution." He noted that the acquisition would add Lumibird Medical's ophthalmology business to IPG's existing medical laser presence in urology and dermatology.

Gitin said the acquisition would increase IPG's advanced solutions revenue mix and create a broader medical laser platform spanning ophthalmology, urology and dermatology. Based on 2025 pro forma results, advanced solutions would represent approximately 26% of IPG's total sales, up from 16% currently, with about $204 million in medical sales.

Deal Terms and Financial Impact

IPG Senior Vice President and Chief Financial Officer Tim Mammen provided details on the transaction:

• Purchase price: €300 million, representing approximately 15.9 times Lumibird Medical's 2025 adjusted EBITDA
• Earn-out provision: Up to €50 million, contingent on financial performance in 2026 and 2027
• Funding source: Cash on hand
• Expected closing: End of the fourth quarter of 2026

Mammen said the company expects to maintain a strong balance sheet and financial flexibility after closing.

IPG expects the acquisition to be accretive to gross margin, EBITDA and adjusted earnings per share in the first year. Mammen noted that because the transaction is a carve-out, IPG does not expect cost synergies in the near term. Longer-term opportunities may include new product co-development and the use of IPG's technical and operational capabilities in lasers, optics and photonics across the combined portfolio.

Mammen also discussed adjustments made to Lumibird's reported IFRS EBITDA to arrive at the adjusted EBITDA measure used in IPG's presentation. These adjustments included differences related to capitalized research and development, lease accounting and other IFRS-related items.

Lumibird Medical's Market Position

Gitin described Lumibird Medical as a global leader in diagnostic and treatment solutions primarily for ophthalmology, with:

• More than 80,000 systems installed globally
• Over 450 employees, including more than 50 in research and development
• Facilities in France, Australia and Slovenia
• Operations serving more than 110 countries
• Brands including Quantel Medical, Ellex and Optotek Medical

Gitin said the company holds strong positions in ophthalmology.