Medtronic Inc., the world's largest heart device maker, said it will acquire Ardian Inc., a closely held company developing a hypertension device that zaps nerves near the kidney, for $800 million.
Medtronic, based in Fridley, Minn., said it will pay $800 million in cash plus additional amounts based on Ardian's revenue through 2015. Medtronic already owns 11 percent of the Mountain View, California, device company.
Medtronic spokesman Christopher Garland says Ardian uses a technique called ablation (uh BLAY shun) to destroy nerve tissue near the kidney, which can reduce uncontrolled blood pressure.
"We believe Ardian's technologies will augment our existing interventional therapies and complement Medtronic's expertise in catheter design and ablation technology, once the acquisition is closed and the product is fully approved in the U.S.," Garland said.
Ardian's technology is "one of the most exciting growth markets in medical devices," Sean Salmon, vice president of Medtronic's coronary and peripheral business, said in a statement.
Ardian released a study Nov. 17 showing its catheter-based device was effective in reducing high blood pressure, or hypertension, in patients who hadn't responded to drugs and other treatments. The 106-patient study found the nerve- destroying procedure dropped patients' systolic blood pressure to an average of 146/84 from a baseline of 178/96.
Medtronic gained 10 cents, or less than 1 percent, to $34.70 at 4:15 p.m. in New York Stock Exchange composite trading. The company's share price has declined 12 percent in the past 12 months.
Medtronic Chief Executive Bill Hawkins said in September that the company would pursue "opportunistic" acquisitions to fill holes in its business. Medtronic has been looking for higher-growth areas as its core businesses in heart and spinal devices experience an industry wide slowdown.
Medtronic has announced 25 pending or completed acquisitions over the past five years, with an average size of $446 million and an average premium of 71 percent, according to data compiled by Bloomberg. The biggest deal was the 2007 purchase of spine-surgery device maker Kyphon Inc. for $3.8 billion.
The device maker had $3.9 billion in cash and short-term investments as of July 10, 2010.