UPDATE: Covidien closes ev3 buyout

July 12, 2010 by MassDevice staff

Hours after announcing the close of its $22.50-per-share tender offer for ev3 Inc., Covidien plc announces the consummation of the $2.6 billion buyout of the Minnesota vascular device maker.

COV, EVVV logos

Covidien plc (NYSE:COV) consummated a $2.6 billion deal to acquire ev3 Inc. (NSDQ:EVVV), hours after closing its tender offer for shares in the Minnesota vascular device maker.

Mansfield, Mass.-based Covidien shelled out $22.50 per share for about 100.8 million ev3 shares. That $2.27 billion gave it roughly 87.7 percent of ev3's outstanding shares and cleared the way for a Covidien holding company to complete the merger without any further input from ev3 stockholders.

A group of those shareholders agreed last week to settle a group of lawsuits filed to block the deal, in return for further details about the run-up to the buyout and how ev3 evaluated the acquisition. That hurdle cleared, the tender offer closed and the rest of the company's shares acquired, ev3 is now a Covidien subsidiary, according to a press release.

Covidien plans to finance the merger, announced June 1, partly through a $1.5 billion offering of senior debt notes, partly with cash and partly though a bridge loan. The debt, issued in a series of three offerings, consists of $500 million worth of 1.875 percent notes due in 2013; $400 million worth of 2.8 percent notes due in 2015; and $600 million worth of 4.2 percent notes due in 2020.

Shortly after word of the deal broke, the Food & Drug Administration granted an expedited review of ev3's Pipeline embolization treatment for cerebral aneurysms. The company said the FDA agreed to hasten its consideration of the pre-market approval application it filed May 18 for the device, which is designed to treat large, giant and wide-necked brain aneurysms.

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