Leading health care products maker
) recently completed its takeover of Israel-based medical devices
firm Oridion Systems Ltd. for $310 million, net of cash and
investments acquired. Covidien expects Oridion's offerings and
technology to broaden its respiratory product line.
Per the agreement, all of Oridion's outstanding capital stock
has been acquired by Covidien. The company plans to report the
acquired entity in its Oximetry and Monitoring product line, which
is a part of its larger Medical Devices segment. Earlier, in
April, the company stated that it does not expect the deal to
materially impact revenues, margin and earnings per share in
Oridion Systems generated revenues of $64 million in 2011. Its
offerings check sufficiency of ventilation. They permit medical
practitioners to quickly gauge problems in airway passages. Some of
its leading products include the Microstream capnography enabled
monitors and the etCO
breath sampling offerings.
Covidien is a leading global health care products company with a
rich history of developing high-quality products in a
cost-effective manner. It competes with
Johnson & Johnson
), among others.
Revenues from Covidien's core Medical Devices segment climbed 6%
year over year to $1.98 billion in the most recent quarter, driven
by double-digit growth across Vascular and Energy Devices product
lines. Revenues from the Oximetry and Monitoring sub-segment rose
4% to $220 million driven by higher sales of monitors.
Covidien remains committed to rolling out new products and
technologies, focusing on the emerging markets, and boosting market
share in core segments through investments in sales and marketing
infrastructure. However, sustained pricing/procedure volume
pressure represents a headwind.
We currently have a Neutral recommendation on Covidien, which is
in tandem with a Zacks #3 Rank (Hold).
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