Medtronic to Acquire Covidien for USD 42.9 billion

Medtronic, Inc. (Minneapolis, MN, USA), a global leader in medical technology, services and solutions, and Covidien plc (Dublin, Ireland), a global healthcare technology and medical supplies provider, announced that they have entered into a definitive agreement under which Medtronic has agreed to acquire Covidien in a cash-and-stock transaction valued at USD 93.22 per Covidien share, or a total of approximately USD 42.9 billion.

The deal creates a medical technology and services company with a comprehensive product portfolio and broad global reach that is better able to improve healthcare outcomes, and meaningfully accelerates Medtronic's core strategies. The combined revenue is expected to reach USD 27 billion, including USD 3.7 billion from emerging markets.

After the completion of the transaction, the businesses of Medtronic and Covidien will be combined under a new entity to be called Medtronic plc. It will have its principal executive offices in Ireland, where Covidien's current headquarters resides and where both companies have a longstanding presence. Medtronic plc will be led by Omar Ishrak, and will continue to have its operational headquarters in Minneapolis, where Medtronic currently employs more than 8,000 people.

Once the transaction is completed, Medtronic will have significantly advanced its position as the world's premier medical technology and services company. The combined company will have a comprehensive product portfolio, a diversified growth profile and broad geographic reach, with 87,000 employees in more than 150 countries. The boards of directors of both companies have unanimously approved the transaction.

As a direct benefit of the company's new financial structure, Medtronic will commit to USD 10 billion in technology investments over the next 10 years in areas such as early stage venture capital investments, acquisitions and R&D in the US, above and beyond Medtronic's and Covidien's existing plans.

"We are excited to reach this agreement with Covidien, which further advances our mission to alleviate pain, restore health and extend life for patients around the world," said Omar Ishrak, chairman and CEO of Medtronic. "This acquisition will allow Medtronic to reach more patients, in more ways and in more places. Our expertise and portfolio of services will allow us to serve our customers more efficiently and better address the demands of the current healthcare marketplace. We also look forward to welcoming the Covidien team to Medtronic and working together to improve healthcare outcomes globally."

"Covidien and Medtronic, when combined, will provide patients, physicians and hospitals with a compelling portfolio of offerings that will help improve care and surgical performance," said José E. Almeida, chairman, president and CEO of Covidien. "This transaction provides our shareholders with immediate value and the opportunity to participate in the significant upside potential of the combined organization. I'd like to thank our 38,000 employees whose hard work and dedication has enabled Covidien to deliver innovative health solutions that improve patient outcomes."

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