FTC, EU approve Medtronic's acquisition of Covidien — 8 things to know

Spinal Tech

Medtronic is plowing forward with their Covidien acquisition as several new approvals come through.

Here are eight updates on the transaction:

 

1. The Federal Trade Commission cleared Medtronic to merge with Covidien on Nov. 26, according to a Walls Street Journal report. The approval was unanimous.

 

2. Medtronic was required to sell Covidien's catheter business for FTC approval. The company sold its catheter business to Spectranetics for $30 million in November.

 

3. Canadian officials approved the deal on the same day the FTC announced approval.

 

4. The European Union's European Commission approved the acquisition on Nov. 28, according to a separate WSJ report.

 

5. To achieve the EU's approval, the companies had to sell Covidien's Strellarex, a drug-coated balloon.

 

6. The acquisition is expected to close in early 2015, on schedule. Both companies plan to hold a meeting in January for shareholder approval. Shortly after the merger was announced, shareholders on both sides sued to stop the merger.

 

7. Medtronic recently announced plans to sell around $10 billion in bonds to finance the acquisition before the year's end to lock in low rates. Some investors could purchase the new Medtronic bonds; the company sold bonds in February, and performance lagged behind the broader market since the sale.

 

8. Medtronic may also take on around $16 million in debt for the transaction due to recent legislative changes making it more difficult to exercise the tax inversion strategy without paying a fine.

 

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