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June 2, 2010
Share ThisCovidien plc (COV) has decided to acquire all of the outstanding shares of ev3 Inc. (EVVV) for $22.50 per share in cash, for a total of $2.6 billion. The transaction will take place in the form of an all-cash tender offer by a wholly-owned subsidiary of Covidien, followed by a second-step merger. Covidien expects to complete the transaction by the end of July, 2010.
On a GAAP basis, Covidien expects the transaction to dilute its fiscal 2010 and 2011 earnings per share. On a non-GAAP basis, the company expects the acquisition to dilute fiscal 2010 earnings per share by 5 to 8 cents and fiscal 2011 earnings per share by 10 to 15 cents. Covidien expects to fund the acquisition with cash on hand, commercial paper and a fully committed bridge facility.
The acquisition of ev3 enables Covidien to become a leading endovascular player, with strong positions in both the peripheral vascular and neurovascular markets.
Covidien is a global health care company that focuses on creating innovative medical solutions for better patient outcomes. The company operates through three business segments: Medical Devices, Pharmaceuticals and Medical Supplies. Covidien generated total revenue of $10.7 billion in fiscal 2009.
ev3 is a Plymouth, MN-based endovascular company that concentrates on catheter-based or endovascular technologies for undertaking minimally invasive treatment for vascular diseases and disorders. The company's acquired broad product portfolio focuses on applications in each of the three sub-markets of the endovascular device market (ev3) − peripheral vascular, cardiovascular and neurovascular.
ev3 competes in the endovascular market with a number of large companies like Boston Scientific Corp. (BSX), Medtronic Inc. (MDT), C.R. Bard (BCR), Cordis and others.
Presently, we have a ‘Neutral’ recommendation on ev3.
Read the full analyst report on "COV"
Read the full analyst report on "EVVV"
Read the full analyst report on "BSX"
Read the full analyst report on "MDT"
Read the full analyst report on "BCR"
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