Anti-trust regulators in U.S., Canada, Europe approve Medtronic-Covidien deal with divesture requirement
Anti-trust regulators in the United States, Canada and Europe gave Medtronic and Covidien something to be thankful for at Thanksgiving. The $43 billion acquisition of Covidien by Medtronic has moved closer to an early 2015 completion.
On. Nov. 26, The U.S. Federal Trade Commisson (FTC) and Canadian FTC approved Medtronic Inc.’s $43 billion merger with Covidien contingent on the sale of a drug-coated catheter business. The European Commission approved the deal on Nov. 28.
The U.S. Federal Trade Commission, which voted 5-0 in favor of the acquisition, did require Minneapolis-based Medtronic to sell off Ireland-based Covidien's Stellarex catheter business before completing the acquisition. Anticipating this requirement, Covidien agreed in October to sell the catheter unit to Spectranetics Corp. for $30 million.
The FTC said it required the sale because Medtronic and Covidien both are developing drug-coated catheters to treat peripheral artery disease and both have products undergoing clinical trials. Under a proposed consent order, a monitor will supervise the transfer of Covidien’s drug-coated catheter business to Spectranetics.
Spectranetics plans to consolidate the Stellarex operations at a new Minneapolis area office after the deal closes, and will hire about 80 Covidien employees who focus on the Stellarex device.
It still has to be approved by shareholders of both companies and sanctioned by the High Court of Ireland. The companies plan to hold a special meeting in January to seek shareholder approval.
Omar Ishrak, chairman and CEO of Medtronic, said this regulatory clearance represents an important milestone in bringing the companies together.
"We continue to make good progress in planning for the integration of these two companies, which will unite them under a single mission — to alleviate pain, restore health and extend life for patients with chronic disease around the world. When the transaction is complete, the combined company will allow Medtronic to reach more patients, in more ways and in more places." VTN
Dr. James White James E. White, MD, FACS, who is board certified in general surgery, phlebology and cosmetic surgery, owns Advanced Surgical Concepts, in Chattanooga, Tenn., a practice in phlebology and cosmetic surgery. He was graduated Magna Cum Laude from the Medical College of Georgia in 1990. He then completed a General surgery residency at the University of Tennessee, Chattanooga in 1996. He is a Diplomat with the American Board of Phlebology and the American Academy of Cosmetic Surgery.more