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Medtronic to acquire Carlsbad, Calif., medical device firm for $225 million
(North County Times (Escondido, CA) Via Acquire Media NewsEdge) Jan. 14--CARLSBAD -- One of the nation's largest medical companies is paying $225 million for a local device manufacturer, according to the two corporations.
Minneapolis-based Medtronic Inc. said the acquisition of Ablation Frontiers Inc. of Carlsbad would widen its portfolio of devices for treating atrial fibrillation, a condition in which two of the human heart's four chambers pump blood too quickly or with an irregular rhythm.
The two companies said they expect the deal to close in Medtronic's fourth fiscal quarter, which runs from late January through April 24.
"Ablation" refers to the neutralization or removal of a layer of tissue or other substance. Medtronic spokeswoman Kyra Schmitt described it as the primary alternative to traditional surgery with scalpels and other cutting tools.
The Carlsbad company's technology selectively burns heart tissue through radio waves to prevent it from conducting faulty nerve signals, Schmitt said. Those technologies have been approved for treating atrial fibrillation in Europe and should be approved for use in the United States some time in 2010, she said.
Ablation Frontiers' shareholders, which include Aberdare Ventures, Versant Ventures and several other venture-capital firms, will receive unspecified payments beyond the initial $225 million if "certain clinical milestones" are met, according to the press release.
Schmitt said Ablation Frontiers will be wrapped into an existing division of Medtronic but will remain in Carlsbad. The five-year-old company employs 160 people worldwide, another Medtronic representative said Tuesday. That number includes between 50 and 99 people at its headquarters on Corte del Abeto just south of Palomar Airport Road, according to year-old data from the state's labor department. It's privately held and thus does not publish its financial reports.
Medtronic said Ablation Frontiers chief executive Keegan Harper would remain as a senior executive in the division under Medtronic.
"Everything's going to be managed and maintained as it is currently," Schmitt said.
Medtronic earned $2.2 billion on revenue of $14.5 billion in its four most recent fiscal quarters, according to its financial filings. The company makes a wide variety of medical devices. It is one of four U.S.-based manufacturers of drug-eluting stents, tiny metal tubes whose coating prevents the formation of scar tissue after they're inserted into blood vessels. Another, Abbott Laboratories, produces the bulk of its coated stents in central Temecula.
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Copyright (c) 2009, North County Times, Escondido, Calif.
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