Updated: 06/16/2014 7:32 AM
Created: 06/15/2014 7:10 PM KSTP.com
By: Cassie Hart
Minneapolis-based Medtronic announced Sunday they have entered into an agreement to acquire Ireland-based competitor Covidien, a medical-device manufacturer.
The agreement is a cash-and-stock transaction valued at $93.22 per Covidien share, or a total of approximately $42.9 billion, based on Medtronic's closing stock price of $60.70 per share on June 13, 2014, according to a news release on Medtronic’s website.
"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," Omar Ishrak, Chairman and Chief Executive Officer of Medtronic, said. "This acquisition will allow Medtronic to reach more patients, in more ways and in more places."
"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 Chief Executive Officer of Covidien.
According to the press release, Medtronic and Covidien will be combined under a new entity to be called Medtronic plc. Its principal executive offices will be in Ireland, where Covidien's current headquarters are and where both companies have a longstanding presence.
Medtronic plc will be led by Mr. Ishrak, and will continue to have its operational headquarters in Minneapolis, where Medtronic currently employs more than 8,000 people, according to the release.
Gov. Mark Dayton released a statement saying he was concerned about the company's presence in Minnesota. It reads in part, "We were assured that the company intends to keep its operational headquarters here in Minnesota and that no jobs will be lost here due to this transaction."
Dayton adds Medtronic intends to create over 1,000 new medical technology-related jobs in Minnesota during the next five years.
The deal is the latest in a series of acquisitions by medical-device manufacturers. The companies are seeking to expand their offerings and contain costs in response to price curbs forced by the nation's new health care law.
In April, Zimmer Holdings, an orthopedic device maker, announced that it was buying Biomet in a $13 billion deal.
The Associated Press contributed to this report.