Welcome!

News Feed Item

Kalorama: Tax Savings Not Only Benefit to Medtronic-Covidien Deal

NEW YORK, Aug. 18, 2014 /PRNewswire/ -- US-based Medtronic said it would purchase Ireland-based Covidien for $42.9 billion (press release: http://bit.ly/1qsbFqb), combining two of the world's biggest medical device makers and helping Medtronic savings with a headquarters change.  Kalorama estimates the deal will come just short of creating the largest device company based on 2013 revenues in its Global Market for Medical Devices, 5th Edition report, released last year.   According to Kalorama, Johnson and Johnson is the largest device company at $28.5 in 2013, but if the new combined company has a strong year of sales, rankings could change.

Kalorama Information Logo

The deal, which is being structured as a so-called inversion, will relocate Medtronic from its legal headquarters in Minneapolis to Covidien's corporate home in Ireland, where the tax rate is significantly lower than in the United States.   Medtronic plans to keep significant operations in the United States.  But Kalorama says the tax implications are only one aspect.  A greater aspect is access to Covidien's rich distribution channels in US and European hospitals. 

"They are probably complementary in terms of distribution venues, and can stay out of each other's revenue lines well," said Bruce Carlson, publisher of Kalorama Information "Covidien staples your wound, keeps track of you in the hospital while Medtronic makes your heart pump, provides a new spine, or provides your body with timed insulin.  Medtronic management is not emphasizing tax savings in the press statements."

According to Kalorama's report, consolidation was a trend in the device industry.  In 2013 and early 2014, key market players were active in acquiring companies, among these were Boston Scientific, Stryker Corporation, CareFusion, ThermoFisher Scientfic, The Carlyle Group, and Medtronic.   Stryker's purchase of MAKO Surgical, Zimmer's purchase of Biomet and the sale of J&J's Ortho Clinical Diagnostic Group to the Carlyle Group were among the larger purchases.   

"The media reports are focusing on the inversion deal, but with a slow-growing device market, consolidation has been an industry trend," Carlson said.  "This wouldn't be announced if there weren't real benefits to the business as well as the tax moves."

Kalorama said that together, the two companies will become one of the largest medical device makers, with 87,000 employees in over 150 countries.  Medtronic will pay $35.19 in cash and 0.956 of a share for each Covidien share.  

Kalorama's complete report on Global Market for Medical Devices, 5th Edition has a complete breakdown of 2013 and early 2014 device acquisitions. The report can be obtained at: www.kaloramainformation.com/redirect.asp?progid=86522&productid=8186981.

About Kalorama Information -- Kalorama Information, a division of MarketResearch.com, supplies the latest in independent medical market research in diagnostics, biotech, pharmaceuticals, medical devices and healthcare; as well as a full range of custom research services. We routinely assist the media with healthcare topics. Follow us on Twitter, LinkedIn and our blog.

For more information on Global Market for Medical Devices, 5th Edition and other reports in Kalorama's research library please visit: http://www.kaloramainformation.com/.

Contact:
Bruce Carlson
[email protected]
212.807.2622

Logo - http://photos.prnewswire.com/prnh/20140801/132634

SOURCE Kalorama Information

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
SYS-CON Events announced today that Sheng Liang to Keynote at SYS-CON's 19th Cloud Expo, which will take place on November 1-3, 2016 at the Santa Clara Convention Center in Santa Clara, California.
Ask someone to architect an Internet of Things (IoT) solution and you are guaranteed to see a reference to the cloud. This would lead you to believe that IoT requires the cloud to exist. However, there are many IoT use cases where the cloud is not feasible or desirable. In his session at @ThingsExpo, Dave McCarthy, Director of Products at Bsquare Corporation, will discuss the strategies that exist to extend intelligence directly to IoT devices and sensors, freeing them from the constraints of ...
Technology vendors and analysts are eager to paint a rosy picture of how wonderful IoT is and why your deployment will be great with the use of their products and services. While it is easy to showcase successful IoT solutions, identifying IoT systems that missed the mark or failed can often provide more in the way of key lessons learned. In his session at @ThingsExpo, Peter Vanderminden, Principal Industry Analyst for IoT & Digital Supply Chain to Flatiron Strategies, will focus on how IoT de...
Complete Internet of Things (IoT) embedded device security is not just about the device but involves the entire product’s identity, data and control integrity, and services traversing the cloud. A device can no longer be looked at as an island; it is a part of a system. In fact, given the cross-domain interactions enabled by IoT it could be a part of many systems. Also, depending on where the device is deployed, for example, in the office building versus a factory floor or oil field, security ha...
24Notion is full-service global creative digital marketing, technology and lifestyle agency that combines strategic ideas with customized tactical execution. With a broad understand of the art of traditional marketing, new media, communications and social influence, 24Notion uniquely understands how to connect your brand strategy with the right consumer. 24Notion ranked #12 on Corporate Social Responsibility - Book of List.
Businesses are struggling to manage the information flow and interactions between all of these new devices and things jumping on their network, and the apps and IT systems they control. The data businesses gather is only helpful if they can do something with it. In his session at @ThingsExpo, Chris Witeck, Principal Technology Strategist at Citrix, will discuss how different the impact of IoT will be for large businesses, expanding how IoT will allow large organizations to make their legacy ap...
Fact is, enterprises have significant legacy voice infrastructure that’s costly to replace with pure IP solutions. How can we bring this analog infrastructure into our shiny new cloud applications? There are proven methods to bind both legacy voice applications and traditional PSTN audio into cloud-based applications and services at a carrier scale. Some of the most successful implementations leverage WebRTC, WebSockets, SIP and other open source technologies. In his session at @ThingsExpo, Da...
DevOps at Cloud Expo – being held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA – announces that its Call for Papers is open. Born out of proven success in agile development, cloud computing, and process automation, DevOps is a macro trend you cannot afford to miss. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the world's largest enterprises – and delivering real results. Am...
What happens when the different parts of a vehicle become smarter than the vehicle itself? As we move toward the era of smart everything, hundreds of entities in a vehicle that communicate with each other, the vehicle and external systems create a need for identity orchestration so that all entities work as a conglomerate. Much like an orchestra without a conductor, without the ability to secure, control, and connect the link between a vehicle’s head unit, devices, and systems and to manage the ...
For basic one-to-one voice or video calling solutions, WebRTC has proven to be a very powerful technology. Although WebRTC’s core functionality is to provide secure, real-time p2p media streaming, leveraging native platform features and server-side components brings up new communication capabilities for web and native mobile applications, allowing for advanced multi-user use cases such as video broadcasting, conferencing, and media recording.
What does it look like when you have access to cloud infrastructure and platform under the same roof? Let’s talk about the different layers of Technology as a Service: who cares, what runs where, and how does it all fit together. In his session at 18th Cloud Expo, Phil Jackson, Lead Technology Evangelist at SoftLayer, an IBM company, spoke about the picture being painted by IBM Cloud and how the tools being crafted can help fill the gaps in your IT infrastructure.
SYS-CON Events announced today that Niagara Networks will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Niagara Networks offers the highest port-density systems, and the most complete Next-Generation Network Visibility systems including Network Packet Brokers, Bypass Switches, and Network TAPs.
In this strange new world where more and more power is drawn from business technology, companies are effectively straddling two paths on the road to innovation and transformation into digital enterprises. The first path is the heritage trail – with “legacy” technology forming the background. Here, extant technologies are transformed by core IT teams to provide more API-driven approaches. Legacy systems can restrict companies that are transitioning into digital enterprises. To truly become a lea...
SYS-CON Events announced today that Interface Masters Technologies, a leader in Network Visibility and Uptime Solutions, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Interface Masters Technologies is a leading vendor in the network monitoring and high speed networking markets. Based in the heart of Silicon Valley, Interface Masters' expertise lies in Gigabit, 10 Gigabit and 40 Gigabit Eth...
In his session at @ThingsExpo, Kausik Sridharabalan, founder and CTO of Pulzze Systems, Inc., will focus on key challenges in building an Internet of Things solution infrastructure. He will shed light on efficient ways of defining interactions within IoT solutions, leading to cost and time reduction. He will also introduce ways to handle data and how one can develop IoT solutions that are lean, flexible and configurable, thus making IoT infrastructure agile and scalable.