Medtronic to buy Covidien for $42.9 billion, rebase in Ireland (Reuters)
(Reuters) - U.S. medical device maker Medtronic Inc (MDT.N) said on Sunday it had agreed to buy Covidien Plc (COV.N) for $42.9 billion in cash and stock and move its executive base to Ireland in the latest transaction aiming for lower corporate tax rates abroad.
While the deal will allow Medtronic to reduce its overall global tax burden, the Minneapolis-based company said it was driven by a complementary strategy with Covidien on medical technology rather than tax considerations
"The real purpose of this, in the end, is strategic, both in the intermediate term and the long term," Medtronic Chief Executive Omar Ishrak said in an interview after the deal was announced. "It is good for the U.S. in that we will make more investment in U.S. technologies, which previously we could not."
Medtronic's corporate tax rate, now at around 18 percent, won't change much, Ishrak said.
The merger of Medtronic, the world's largest stand-alone medical device maker, and Covidien, a maker of devices used in a range of surgical procedures, will create a close competitor in size to the medical device business of industry leader John...
