AsianScientist (Oct. 2, 2012) – Minneapolis-based medical device manufacturer Medtronic, Inc. has agreed to acquire China Kanghui Holdings for approximately US$816 million in cash ($30.75 per American depository share).
The total value of the transaction, net of Kanghui’s cash, is expected to be approximately US$755 million.
“China is one of the fastest growing medical device markets with significant scale opportunities, and now Medtronic will establish a bigger and more direct local presence,” said Chris O’Connell, executive vice president and president of Medtronic’s Restorative Therapies Group, including the Neuromodulation, Spine, Surgical Technologies and Diabetes businesses.
“Kanghui brings Medtronic a broad product portfolio, a strong local R&D and manufacturing operation, a vast China distribution network and an exceptional management team. This move will provide Medtronic sustainable advantages in the fast-growing Chinese orthopedic segment, as well as a foothold in the emerging global value segment in orthopedics,” he added.
Headquarted in Changzhou, Kanghui is a public company founded in 1997 and is traded on the NYSE under KH. Its portfolio of orthopedic devices in China includes a new product pipeline in trauma, spine, and joint reconstruction.
The transaction is expected to close in the next few months and is subject to customary closing conditions, including approval from the shareholders of Kanghui.
Medtronic expects the net impact from this transaction to be earnings neutral for fiscal years 2013 and 2014 as the company intends to offset any dilutive impact of the transaction.
—–
Source: Medtronic.
Disclaimer: This article does not necessarily reflect the views of AsianScientist or its staff.
