The company announced Monday that it is taking a 19 percent equity stake in cardiovascular device makerLifetech Scientific Corp., worth $46.6 million, and will also buy a $19.6 million convertible note that amounts to another 7.4 percent equity stake. Medtronic also has the right to get a larger piece of the company should Lifetech achieve certain financial or developmental milestones. Lifetech’s shares trade on the Hong Kong Stock Exchange.
In exchange, the Minnesota company will obtain the right to sell Lifetech’s current and future products. The Shenzhen-based company makes minimally invasive devices for cardiovascular and peripheral vascular diseases.
“China is key to our global strategy as we continue to expand our geographic footprint and strive to meet the needs of local cardiovascular patients, and this agreement reaffirms our commitment to this important market,” said Mike Coyle, executive vice president and president of the Cardiac and Vascular Group at Medtronic, in a news release.
Aside from Medtronic’s money, Lifetech will also receive “services and expertise” that will “support its continued growth, development pipeline and manufacturing capabilities,” the company said.
“As the world’s largest medical device maker, an alliance with Medtronic provides Lifetech with access to world-class expertise and leading-edge technologies, and allows us to expedite bringing those technologies to patients who need them in China and global markets,” said Mr. Zhao Yiwei (Michael Zhao), executive director and chief executive officer of Lifetech, in the announcement.
Lifetech’s shareholders are expected to vote on the transaction, which is also pending regulatory approvals from Chinese and Hong Kong regulatory authorities.