Medtronic buys Canadian device firm CryoCath.
In a move to expand its treatment portfolio for heart conditions, including abnormal heart rhythms, Medtronic Inc. is buying Canadian device company CryoCath Technologies.
Minneapolis, MN-based Medtronic pay 8.75 Canadian dollars per share, for a total of 400 million Canadian dollars ($380 million), to buy the outstanding shares of Montreal-based CryoCath. The deal represents a 97% premium to CryoCath's closing price on Sept. 24, which was 4.44 Canadian dollars on the Toronto Stock Exchange.
CryoCath's board of directors unanimously recommended that shareholders accept the offer, and the acquisition is expected to close in the fourth quarter of this year.
"Medtronic estimates that up to five million patients worldwide are impacted by atrial fibrillation," said Pat Mackin, president of the Cardiac Rhythm Disease Management business and senior vice president at Medtronic. "Medtronic and physicians are interested in procedures that are safer, faster and less complex so that more patients can benefit from treatment."
CryoCath's major technology is called Arctic Front, a minimally invasive cryo-balloon catheter designed specifically to treat atrial fibrillation, a disrupted rhythm in the upper chambers of the heart. Officials at CryoCath predict the product will respond to an emerging $2 billion market opportunity. Marketed in Europe and the subject of a pivotal study in the United States, Arctic Front has been used to treat approximately 3,100 patients, according to CryoCath. The company had sales of 40 million Canadian dollars last year.
"Medtronic's offer reflects its endorsement of our cryoablation technology and the role that our flagship product, Arctic Front, will play in treating atrial fibrillation patients around the world," said Jan Keltjens, president and CEO of CryoCath. "This offer delivers significant value. Joining forces with Medtronic at this stage in our development will dramatically expand our reach and accelerate innovation to the benefit of patients today and tomorrow."
The closing of the transaction is subject to regulatory clearance and other customary conditions.
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|Title Annotation:||Top of the News|
|Publication:||Medical Product Outsourcing|
|Date:||Oct 1, 2008|
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