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Medtronic Acquiring Covidien

The transaction, which is subject to regulatory clearances in the U.S., E.U., China and certain other countries, is expected to close by early 2015 and is valued at ~$42.9 billion. Following completion, the combined businesses will be called Medtronic plc with principal executive offices in Ireland. Operational headquarters will remain in Minneapolis, MN.

Medtronic will commit $10 billion in technology investments over the next 10 years to support early-stage venture capital investments, acquisitions and R&D in the U.S.

Michael Matson of Needham & Company notes that "The acquisition broadens MDT's current portfolio of cardiovascular, spine, neuromodulation, and diabetes products to include COV's surgical, vascular, respiratory, and patient monitoring products." Further, Matson thinks that "cash-rich balance sheets, slow market growth, pricing pressure, and consolidation among the med tech companies' customers are all driving deals in addition to tax considerations" such as those that might be in play given the difference between the Ireland vs. U.S. corporate tax rate (12.5% vs. 35%, respectively, per Wells Fargo).

COV includes Sports Surgery among its product categories online, listing just one product that is part of the Stratis Femoral Fixation Device. Other products for ACL and meniscus repair, such as TriTis and Herculon, remain visible via site search but are not named otherwise in COV's web site.

Medtronic's press release

DealBook/New York Times coverage

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