Medtronic ($MDT) on Thursday entered separate agreements to buy PEAK Surgical, which is based in Palo Alto, CA, and Portsmouth, NH-based Salient Surgical Technologies. The two deals combined are valued at about $645 million.
PEAK specializes in surgical instruments based on its proprietary PlasmaBlade technology, which consists of a family of disposable cutting devices with proprietary insulation technology. PEAK's technology is cleared for use in a variety of settings, including ear, nose and throat, plastic reconstructive, orthopedic and general surgical applications.
Meanwhile, the Salient transaction is valued at $525 million. The company's revenue is annualizing at approximately $100 million and is growing rapidly, according to a Medtronic statement. Its Transcollation technology has enabled healthcare professionals to optimize care for more than 650,000 patients worldwide undergoing a variety of surgical procedures including orthopedic surgery, spine, open abdominal and thoracic procedures.
"Integrating the Salient Surgical Technologies organization will bring new applications to Medtronic Surgical Technologies' current surgical therapy areas and expand the company's opportunities in adjacent offerings, helping Medtronic serve new customers and better meet the needs of existing ones," said Chris O'Connell, executive VP and president of Medtronic's Restorative Therapies Group.
Salient has 300 employees, while Peak has 50, the New Hampshire Union Leader reports.
The acquisitions represent "a new and interesting growth avenue for the company," according to Morgan Stanley analyst David Lewis, as quoted by the Star Tribune. Lewis also questioned how aggressively Medtronic will pursue growth in the general surgery area, an area dominated by Johnson & Johnson and Covidien.