Covidien Acquires ev3 to Expand Interventional Portfolio
June 2, 2010 – Covidien announced yesterday it is purchasing ev3 Inc. for $2.6 billion to expand its percutaneous vascular portfolio. The company hopes to become a leading endovascular player in both the peripheral vascular and neurovascular markets.
ev3 Inc. developed several technologies for the treatment of peripheral vascular and neurovascular diseases. It produces peripheral angioplasty balloons, stents, plaque excision systems, embolic protection devices, liquid embolics, embolization coils, flow diversion, thrombectomy catheters and occlusion balloons.
"The acquisition of ev3 will enable Covidien to significantly expand its presence in the vascular market and is in line with our strategy of becoming a leading partner with vascular surgeons, neurosurgeons, interventional cardiologists and interventional radiologists," said Richard J. Meelia, chairman, president and CEO of Covidien. "With its broad product portfolio, clinical expertise and call-point synergies with our existing vascular franchise, ev3 will be an important addition to our innovative vascular intervention products."
"We will be able to advance our broad platform of peripheral vascular and neurovascular technologies with a leading global health care products company that shares our vision of delivering breakthrough and innovative medical solutions for improved patient outcomes,” said Robert Palmisano, president and CEO of ev3. “In addition, this combination will provide the opportunity for further innovation to support endovascular market growth and procedure penetration worldwide, while our employees will be afforded the opportunity to be part of a larger organization with greater depth of resources for sustained success in our industry."
Covidien's plans to acquire ev3 reflects the company's ongoing efforts to maximize its position in the cardiovascular device market, said Cardiovascular Division Manager, Stephanie LaBelle, cardiovascular division manager of Millennium Research Group, a health care market analyst company. “In particular, it will secure Covidien's position in the market for the treatment of peripheral arterial disease, which is a nice complement to previous acquisitions — VNUS Medical Technologies and Bacchus Vascular — that were focused on the treatment of venous disease."
The companies signed a definitive merger agreement under which Covidien will acquire all of the outstanding shares of ev3 for $22.50 per share in cash, for a total of $2.6 billion, net of cash acquired.
Covidien intends to finance the transaction through a combination of cash on hand, commercial paper and a fully committed bridge facility.
For more information: www.covidien.com, www.ev3.net