Medtronic buys CryoCath Technologies for $380 million to expand cardiac treatment portfolio

26 September 2008

The world's second-largest medical device maker Medtronic Inc. said yesterday that it will buy Canadian company CryoCath Technologies for about $380 million in a move to expand its treatment portfolio for heart conditions, including abnormal heart rhythms.

Minneapolis-based Medtronic said it will pay $8.75 Canadian per share, or $400 million Canadian ($380 million), to buy the remaining shares of Montreal-based CryoCath. The deal represents a 97-per cent premium to CryoCath's closing price on 24 September, which was 4.44 Canadian dollars on the Toronto Stock Exchange.

The CryoCath board of directors has unanimously recommended that CryoCath shareholders accept the offer, and the acquisition is expected to close in the fourth quarter of calendar 2008.

"Medtronic estimates that up to five million patients worldwide are impacted by atrial fibrillation," said Pat Mackin, president of the cardiac rhythm disease management business and senior vice president at Medtronic. "Medtronic and physicians are interested in procedures that are safer, faster and less complex so that more patients can benefit from treatment."

"Medtronic's offer reflects its endorsement of our cryoablation technology and the role that our flagship product, Arctic Front, will play in treating atrial fibrillation patients around the world," said Jan Keltjens, president and CEO of CryoCath. "This offer delivers significant value. Joining forces with Medtronic at this stage in our development will dramatically expand our reach and accelerate innovation to the benefit of patients today and tomorrow."

Arctic Front is a minimally invasive cryo-balloon catheter designed specifically to treat atrial fibrillation, a disrupted rhythm in the upper chambers of the heart and an emerging $2 billion market opportunity. Marketed in Europe and the subject of a pivotal study in the US, Arctic Front has been used to treat approximately 3,100 patients.