March 22, 2013—Aesthetic laser company Cynosure (Westford, Mass., U.S.A.) announced the definitive acquisition of its competitor, Palomar Medical Technologies (Burlington, Mass., U.S.A.), in a cash and stock transaction worth $294 million. The combined revenue of the two companies in calendar year 2012 was over $234 million with 52 percent of product revenue coming from North America and 48 percent originating from the international markets. Whereas the two companies had been competing on overlapping projects, the merger creates a single profitable company with a total combined base of more than 20,000 aesthetic laser system installations worldwide, and a distribution network spanning over 100 countries.

In the agreement, expected to close in the third quarter of 2013, Palomar shareholders will receive $13.65 per share of Palomar stock, half in cash and half in common stock, a 23 percent premium above Palomar’s average closing price. Cynosure plans to issue approximately 5.2 million shares and fund the remainder via approximately $147 million in cash. The acquisition is expected to be accretive to Cynosure in 2014.

The acquisition will leave Cynosure shareholders with about 77 percent and Palomar shareholders holding 23 percent of the combined company. Cynosure’s CEO, Michael Davin, will remain as CEO and chairman of the board of directors, and Palomar’s president and CEO, Joseph Caruso, will remain as president and as Vice Chairman of Cynosure’s board.

Cynosure ultimately plans to relocate its headquarters from Westford, Mass., to Palomar's facility 15 miles away in Burlington.