Thoratec to buy out Australia's HeartWare
14 February 2009
US-based cardiac-device maker Thoratec Corp will buy Australia's HeartWare International for about $282 million in a cash-and-stock deal, which could give Thoratec a hold over the market for machines that help pump blood in patients with a weak heart.
The Pleasanton, California-based Thoratec said half the price will be paid in cash, and the other half in Thoratec stock. Thoratec and HeartWare both make ventricular assist systems, or small implanted devices that help the lower left chamber of the heart pump blood. The devices are used to help patients with end-stage heart failure.
Thoratec will also provide HeartWare a convertible loan facility of up to $28 million to fund ongoing operations until the deal closes, expectedly in the second half of 2009. Thoratec expects to record deal-related one-time charges of about $15 million to $20 million through the balance of 2009. The deal is also expected to dilute Thoratec's earnings into 2011.
HeartWare's operations will be integrated into Thoratec's cardiovascular division, the companies said.
Thoratec makes the HeartMate II and HeartMate XVE systems. They are approved in the US for patients with end-stage heart failure, and Thoratec is seeking Food and Drug Administration clearance to market the devices for patients awaiting heart transplants as well.
On 30 January, HeartWare said regulators had approved its HeartWare device for sale in the European Union. The company said it was beginning preparations for the commercial rollout of the product, starting with the hospitals where HeartWare was tested and expanding to key hospitals over the coming months.
Thoratec is a leader in developing left ventricular assist devices while HeartWare has some new generation products in development.