Medtronic to buy Irish manufacturer Covidien in latest acquisition among medical-device makers

U.S. medical device manufacturer Medtronic says it has agreed to buy Ireland-based competitor Covidien for $42.9 billion in cash and stock, a 29 per cent premium on Covidien’s stock price.

The combined company would have its executive offices in Dublin, where it could benefit from Ireland’s lower corporate tax rates. But the merged company would continue to operate in Minneapolis, where Medtronic employs 8,000.

The deal is the latest in a series of acquisitions by medical-device manufacturers. The companies are seeking to expand their offerings and contain costs in response to price curbs forced by the nation’s new health care law.

In April, Zimmer Holdings, an orthopedic device maker, announced that it was buying Biomet in a $13 billion deal.