STAAR Surgical’s largest shareholder has said it plans to vote against Alcon’s proposed $1.5bn takeover of the ailing eye specialist.
Broadwood Partners, which owns 27.3% of STAAR’s common shares, said the transaction, announced last month, suffered from “multiple process and valuation deficiencies”.
The investment firm expressed disappointment over the actions of STAAR’s board, claiming it had failed to pursue an “adequate” sale process. According to Broadwood, STAAR’s board also displayed “intransigence” in relation to Broadwood’s books and record demand, stating it had received no documents since making the request more than three weeks ago.
STAAR’s Q1 2025 financials revealed a 45% decline in sales to $42.6m, down from $77.4m in Q1 2024, with the US-based company chiefly attributing the sharp decline to weakened demand in China and additional headwinds due to government initiatives in the country affecting device procurement.
Broadwood’s primary point of contention relates to the proposed financial terms of Alcon’s acquisition. The shareholder pointed out that Alcon previously offered $55 per share for STAAR when it moved to acquire the company in October 2024 – a price “far above” the current offer of $28 per share.
Alcon subsequently pulled back from its initial offer after learning that STAAR was facing inventory management challenges, with the revelation giving the Swiss company pause over STAAR’s short-term performance and stability.
However, Broadwood highlighted that these previous challenges had now been addressed, and that STAAR had improved its cost discipline, a resolution Broadwood now expects will lead to a “sharp rebound” in STAAR’s revenue and profits in the coming quarters.
Bolstering these claims, Broadwood also highlighted that the results of a clinical trial [NCT06700460] comparing Alcon’s LASIK platform to STAAR’s EVO Implantable Collamer Lens (ICL) for treating astigmatism are soon due for publication. The shareholder said the trial results may have “significant implications” for the competitive positioning of the EVO ICL relative to LASIK, and in turn to STAAR’s “growth prospects and strategic value” to potential acquirers within the ophthalmic products industry.
The company said in a statement: “Broadwood is concerned that stockholders are now being asked to accept inferior terms, despite the fact that the challenges that followed Alcon’s initial bid have been substantially resolved.”
In closing, Broadwood reiterated that it held “serious concerns” about the overall fairness and integrity of the sales process, stating: “In addition to the insufficient merger consideration, [the factors at hand] lead us to believe that the acquisition is not in the best interest of STAAR’s shareholders. Accordingly, Broadwood intends to vote against the acquisition and asks the board to immediately reconsider its recommendation thereof.”
