LivaNova strikes $250M deal to buy TandemLife

TandemLife's pump (TandemLife)

LivaNova has agreed to buy TandemLife in a $250 million deal. The takeover will see LivaNova pay $200 million upfront to add TandemLife’s life support technologies to its cardiac surgery portfolio.

TandemLife’s business revolves around a small pump and accompanying controller. The Pittsburgh, Pa.-based company first deployed these technologies in the early 2000s as part of a suite of devices for left heart support. More recently, TandemLife has combined the pump and controller with an oxygenator and different cannulas to provide pulmonary and cardiopulmonary support. 

LiveNova is paying $200 million upfront and committing to $50 million in regulatory milestones in the belief it can get more out of the products. TandemLife grew sales by 45% last year, but its business is heavily skewed to the U.S. That gives London-based LivaNova the chance to drive midterm growth by expanding international sales while also working to gain market share in the U.S.. 

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“We will leverage our customer base and global infrastructure to increase penetration in the U.S. and to expand geographically,” LivaNova CEO Damien McDonald said in a statement.

Other growth drivers on the horizon include the introduction of a new pump and controller. LivaNova is also planning to expand use of the products into more cardiopulmonary applications, although the payoff from those planned activities is years down the line. 

The takeover continues LivaNova’s attempts to build up the two business units that will remain after it completes the $190 million sale of its cardiac rhythm unit. LivaNova agreed to sell the non-core unit to MicroPort Scientific in November. Weeks later, LivaNova struck a $225 million deal to buy ImThera Medical.

That deal gave LivaNova an implantable sleep apnea device to develop and sell alongside its existing portfolio of neuromodulation products. This week’s buyout complements LivaNova’s other remaining unit, which is focused on cardiac surgery.

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