* CEO sees continuing tax-driven inversion deals in sector
* Low-cost hips and knees to address 5-10 pct of U.S. market
* Q2 revenue $1.15 billion vs consensus $1.14 billion
* Trading profit $255 million vs consensus $250 million (Updates and recasts with further share price gains)
LONDON, Aug 1 (Reuters) – Smith & Nephew (S&N), Europe’s largest maker of artificial joints, expects continued deal-making in the medical technology sector but has not come under pressure from investors to sell out, its chief executive said on Friday.
Olivier Bohuon, who has eschewed a wave of mergers sweeping the industry, said S&N had a bright future as a standalone group after reporting improved second-quarter results that came in just ahead of analyst expectations.
The British company is no stranger to bid talk, having been touted as a target, on and off, ever since receiving an approach from Unilever in 1968.
But the deal rumours have lately grown louder, with a wave of U.S. healthcare companies now striving to move their tax bases abroad in a tactic known as “inversion”.
Reports that Stryker was considering such a move on S&N in May sent its shares surging, only for the U.S. rival to rule out bidding for six months.
S&N shares were up again on Friday, gained 3.7 percent by 1405 GMT.
While Bohuon sees no strategic case for getting bigger in orthopaedics for the sake of it, he acknowledged that inversion deals were likely to continue.
