(Updated, 9:55 a.m.)
MANSFIELD – Covidien Plc has agreed to pay $2.6 billion to buy ev3 Inc., a maker of products used in treating heart disease, the companies said Tuesday.
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Covidien will pay $22.50 a share for ev3, which is based in Plymouth, Minn., the companies said. The transaction is expected to be completed by July 31.
Covidien stock fell 1.8 percent, or 79 cents, to $41.61 a share in New York Stock Exchange trading early Monday morning.
Ev3 was founded in 2000 and makes products such as angioplasty balloons, stents, catheters and embolic protection devices. The company posted a profit of $41.9 million, or 38 cents per diluted share, in 2009. Revenue rose 6.4 percent from the prior year to $449.1 million.
The purchase is the latest move by Covidien to ramp up its offerings in the vascular market. Last year, the company bought San Jose-based VNUS Medical Technologies Inc., which makes products such as catheters, and in March the company bought Orthofix International N.V.’s vascular business.
“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,” Covidien Chairman, President and CEO Richard J. Meelia said in a statement.
Covidien said the acquisition will reduce it’s earnings per share both this year and next year.
Separately, Covidien said Tuesday it has signed a deal to sell two of its sleep therapy products to PH Invest, a privately held company in Luxembourg. Financial terms were not disclosed.
PH Invest is buying several of Covidien’s CPAP and Bi-level products sold under the GoodKnight and Sandman brands and a factory in France.
The agreement does not include sleep products Covidien sells under the Adam, Breeze and Dreamfit brands.
Additional information is available at covidien.com and ev3.net.
