MINNEAPOLIS and MONTREAL, Sept. 25 /CNW/ - Medtronic, Inc. (NYSE: MDT)
and CryoCath Technologies Inc. (TSX: CYT) today announced they have entered
into an agreement whereby Medtronic, through a wholly owned subsidiary, will
make a takeover bid for all of the outstanding shares of CryoCath for $8.75
Cdn per share in cash, representing a total equity value of approximately $400
million Cdn ($380 million USD).
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(R), 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
The offer price represents a 97 percent premium to the closing price of
the common shares of CryoCath on September 24, 2008, the last trading day
prior to the announcement of the offer and a 93 percent premium to the volume
weighted average trading price of the shares for the last 20 trading days.
The agreement was entered into following the completion of due diligence
and negotiation during an exclusivity period and provides for, among other
things, a non-solicitation covenant on the part of CryoCath, subject to
"fiduciary out," superior proposal and right-to-match provisions and the
payment of a $13.6 million break-up fee in certain circumstances.
Medtronic's offer to purchase is subject to the tender of at least 66 2/3
percent of CryoCath's outstanding common shares on a fully diluted basis. The
closing of the transaction is also subject to regulatory clearance and other
A take-over bid circular containing the terms of the offer and additional
information regarding the offer, as well as a directors' circular describing
the background to the offer, will be mailed to CryoCath shareholders in the
near future. Once mailed, these documents will also be available on the SEDAR
website at www.sedar.com.
Asanté Partners is the financial advisor to the Board of Directors of
CryoCath and legal counsel to CryoCath is Davies Ward Phillips & Vineberg LLP.
Medtronic is being represented by Stikeman Elliott LLP.
CryoCath - www.cryocath.com - is a medical technology company that leads
the world in cryotherapy products to treat cardiac arrhythmias. With annual
sales in excess of $40 million Cdn, its products are routinely used in more
than 500 centers around the world. The Company's flagship product, Arctic
Front, is a minimally invasive cryo-balloon catheter designed specifically to
treat Atrial Fibrillation, an emerging $2 billion market opportunity. Marketed
in Europe and the subject of a pivotal study in the United States, Arctic
Front has been used to treat approximately 3,100 patients.
Medtronic, Inc. (www.medtronic.com), headquartered in Minneapolis, is the
global leader in medical technology - alleviating pain, restoring health, and
extending life for millions of people around the world.
Any forward-looking statements are subject to risks and uncertainties.
Medtronic cautions readers that any forward-looking information is not a
guarantee of future performance and that actual results could differ
materially from those contained in the forward-looking information. Forward
looking statements include, but are not limited to, statements about the
benefits of the acquisition, including future financial and operating results,
post-acquisition plans, objectives, expectations and intentions and other
statements that are not historical facts. The following factors, among others,
could cause actual results to differ from those set forth in the
forward-looking statements: the ability to obtain regulatory approvals of the
proposed acquisition, including antitrust approvals; the failure of CryoCath
shareholders to deposit a sufficient number of shares; the risk that the
businesses will not be integrated successfully; the risk that the cost savings
and any other synergies from the acquisition may not be fully realized or may
take longer to realize than expected; disruption from the acquisition making
it more difficult to maintain relationships with customers, employees or
suppliers; and competition and its effect on pricing, spending, third-party
relationships and revenues. Additional factors that may affect future results
are contained in Medtronic's Annual Report on Form 10-K for the year ended
April 25, 2008. Actual results may differ materially from anticipated results.
Medtronic disclaims any obligation to update and revise statements contained
in this release based on new information or otherwise.
CryoCath Safe Harbor
This press release includes "forward-looking statements" that are subject
to risks and uncertainties, including with respect to the timing of regulatory
trials and their outcome. For information identifying legislative or
regulatory, economic, climatic, currency, technological, competitive and other
important factors that could cause actual results to differ materially from
those anticipated in the forward looking statements, see CryoCath's annual
report available at www.sedar.com under the heading Risks and Uncertainties in
the Management's Discussion and Analysis section.
For further information:
For further information: Medtronic Contacts: Christopher Garland, Public
Relations, (952) 905-6805; Jeff Warren, Investor Relations, (763) 505-2696;
CryoCath Contact: Ross Marshall, Equicom Group, Phone: (416) 815-0700 ext.