Texas’ Greatbatch to buy Lake Region Medical for $1.7 billion
MINNEAPOLIS — Lake Region Medical, which got its start in the Twin Cities making Medtronic’s pacemaker leads in the 1960s, has agreed to be sold to a Texas firm in a $1.73 billion deal later this year.
Greatbatch will pay $478 million in cash plus 5.1 million shares of common stock, and also assume about $1 billion in Lake Region Medical debt, as part of the deal. The companies expect the deal to quickly turn profitable, estimating it will drive double-digit growth in earnings per share next year.
The companies had combined revenue of $1.5 billion in 2014. Combined, the companies will sell parts and manufacturing solutions to major medical device companies for cardiac-rhythm management, neuromodulation, and vascular, orthopedics and surgical therapies. In particular, Greatbatch in its announcement cited new access to the advanced surgical and interventional cardiology markets.
“I am very proud of the Lake Region Medical team and what they have accomplished over many years,” Lake Region Medical CEO Donald Spence said in a news release.
“I am confident the combination of Lake Region Medical and Greatbatch will form an even stronger entity with unmatched technology and manufacturing capabilities.”
Starting out as a fishinglure company in 1947, Lake Region Medical found success in the 1960s when the family-run operation figured out how to make tightly coiled wires for some of Medtronic’s earliest pacemakers.
Today it describes itself as helping the world’s largest device companies “bring products from concept to point-of-care” in cardiology, vascular and surgical markets.
In March 2014, Lake Region Medical was acquired for an undisclosed price by a large med-tech supplier called Accellent, which changed its brand name to Lake Region Medical shortly after the deal. Accellent had been scheduled to change its legal name to Lake Region Medical by the end of this year.
Accellent’s Massachusetts home base became world headquarters for Lake Region Medical.