Medtronic, Inc. MDT and
LifeTech Scientific Corporation today announced the closing of a
transaction creating a strategic alliance thatbrings together the resources
and technologies of the world's largest medical device company with the local
market expertise, brand recognition and growth potential of a recognized
leader in China, which is fast becoming one of the world's largest device
markets. The strategic alliance will allow each company to serve
cardiovascular patients and clinicians who previously have been unreachable by
either company alone, and to develop a more robust cardiovascular platform.
Under the terms of the definitive agreements, Medtronic purchased a 19.0
percent equity interest in LifeTech, and received the right of first
negotiation to distribute current and future LifeTech products as well as the
opportunity to acquire additional ownership in LifeTech. Medtronic will also
provide services and expertise to LifeTech to support its continued growth,
development pipeline and manufacturing capabilities to better serve patients
and clinicians in China and globally.
Medtronic purchased its initial equity investment for HK$3.80 per share or
HK$361 million (approximately US$46.5 million) in total. Medtronic also
purchased a HK$152 million (approximately US$19.6 million) convertible note
representing an additional approximately 7.4 percent equity on a fully-diluted
post-conversion basis. Medtronic will also have the opportunity to acquire
additional convertible notes.The investment is consistent with Medtronic's
capital allocation strategy and meets internal financial return expectations.
The transaction closing follows the receipt of approvals from the shareholders
of LifeTech and applicable Chinese and Hong Kong regulatory authorities.
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