Details of the mega-merger: Covidien makes the 1st move, Almeida prepares to step down

Medtronic and Covidien open up about $43B mega-merger

Covidien (NYSE:COV) updated its employee FAQ this week, providing additional information about the $43 billion acquisition by Medtronic (NYSE:MDT).

Here are a few interesting tidbits and updates from the mega-merger:

  • The deal is nearly 5 months in the making. Covidien first approached Medtronic in March, hoping that the larger company would be the best fit, the most interested and the highest-paying of its options.

"The Covidien board of directors has, on an ongoing basis, considered the long-term strategy of Covidien and strategic opportunities that might be available to Covidien to enhance shareholder value, including additional investments in new growth opportunities, potential acquisitions and the possible sale or merger of Covidien," the company said. "Following consideration by the Covidien board of various potential strategic opportunities, on March 20, 2014, the Covidien board authorized Covidien management to approach Medtronic to discuss a potential combination of the two companies."

  • Covidien chief Jose Almeida will step down once the deal closes, which is expected to happen late this year or early in 2015.

"The executive leadership team will remain in their roles and continue as usual until the deal closes," according to the filing. "At that time, Joe Almeida will step down from his role as Chairman, President and CEO and Omar Ishrak who is currently the chairman and CEO of Medtronic, will continue in that capacity."

Read more about the $43B Medtronic-Covidien mega-merger

"Both Covidien and Medtronic continue to educate Members of the U.S. Congress on the rationale and merits of this transaction and why the combined product portfolios will make Medtronic a preeminent leader in delivering solutions to address the major disease states impacting patients and healthcare costs around the world," the companies said. "The strategic and operational benefits are the primary drivers of the decision by Medtronic to acquire Covidien, not the concept of tax inversion as has been reported by the media."

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