Covidien to buy medical device maker Somanetics for about $299 million

Healthcare products company Covidien plc yesterday agreed to buy medical device maker Somanetics Corporation for about $299 million in cash, in order to broaden its product portfolio.

Somanetics is a leader in cerebral and somatic oximetry. It's Invos Cerebral / Somatic Oximeter, a non-invasive patient monitor, continuously measures blood oxygen levels in the brain and in the body of patients who are at risk for restricted blood flow.

The Invos System is the only commercially-available cerebral/somatic oximeter that has shown to improve patient outcomes and is used in 750 hospitals across the US. The company sells the product in the US, Europe, Canada, the Middle East, South Africa and Japan.

Michigan-based Somanetics, which had 2009 sales of $50 million and has approximately 150 employees, also provides Vital Sync system, a data integration device that collects and organises data from various hospital bedside devices and displays them at the bedside.

Covidien, based in Dublin, Ireland and a former subsidiary of Tyco International, is one of the world's largest providers of healthcare devices and supplies, and had revenues of $10.7 billion last year.

It significantly expanded its product range by making more than 50 acquisitions between 1996 and 2002.