logo  
Sign in or Register

Already a member?

Sign in

Or sign in with your account on:

Not a member yet?

Register
    

Covidien (COV) Paying $680 Million for Camera-in-a-Pill Maker Given Imaging (GIVN)

By  +Follow December 9, 2013 7:38AM
Share:
Tickers Mentioned:

Medical device manufacturer Covidien plc (COV) said Sunday that it is buying medical technology company Given Imaging Ltd. (GIVN) in a transaction valued at $860 million to expand its gastrointestinal diagnostic business. The news came after three units of Nochi Dankner’s IDB group agreed Saturday to sell their positions in Given Imaging, although the name of the buyer was not disclosed.

Covidien, which is headquartered in Dublin, Ireland, said it will pay $30 per share for Israel-based Given, representing about a 27-percent premium to Friday’s closing price of $23.65 per share of GIVN. The boards of both companies have approved the acquisition, which is expected to close by the end of March 2014.

Capsule Endoscopy

Given Imaging is a pioneer in capsule endoscopy. The company has developed PillCam, an ingestible capsule containing a tiny camera that when swallowed allows clinicians to look inside, and monitor and diagnose the digestive system as an alternative to a traditional endoscopy. Given has been under pressure for nearly two years to sell itself, including investor Discovery Group urging the company in October to initiate a $50 million share buy-back plan and put itself on the auction block again, saying it is chronically undervalued because of poor management. At that time, Discovery Group, which owns about 4 percent of Given Imaging, thought the company could get an offer of up to $30 per share. Looks like it was right.

Covidien said that it will use cash on hand to fund the purchase. Given Imaging will report within the medical devices segment of Covidien and is expected to add between $40 million to $50 million per quarter in incremental revenue to the division. From profit and operating margin standpoints, the acquisition is not expected to be accretive until fiscal 2015.

A Strong Q3 for Given Imaging

During the third quarter ended September 30, Given Imaging generated $50 million in sales, up 10 percent from the year prior quarter. Adjusted earnings were $8.2 million, or 25 cents per share, up 4 percent from Q3 2012. Global PillCam sales increased 9 percent during the quarter to 63,500 capsules. Worldwide sales of GI diagnostics products improved by 15 percent to $15.3 million. By integrating the Given Imaging operations, Covidien will be able to leverage its global reach to further bolster sales of Given’s products.

“We believe GI is one of the most attractive specialty procedure areas. Acquiring Given will enable Covidien to significantly expand its presence in a $3 billion GI market,” said Bryan Hanson, Group President, Medical Devices & U.S., Covidien, in a statement today.

“After thoroughly evaluating our strategic options we determined that this transaction is in the best interests of Given Imaging, its shareholders and employees and provides unique benefits to patients globally,” added Homi Shamir, president and chief executive at Given Imaging Ltd.

Shares of GIVN jumped ahead to near the buyout price at the opening bell. Through Friday’s close, the stock price was up about 33 percent in 2013. Shares of COV, which were up 28 percent in 2013 through Friday, have inched up about half a percent in Monday morning action to $68.48.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


Signup for our daily newsletter and get our best articles emailed right to you!

Results for COV
FOREX Insight
21 Oct 14 15:19:03
RT @RiskReversal: ICYMI: Monday's Notable Options Activity: $AAPL, $COV, $XLI, $JCP, $RICE http://t.co/fyeUICTnnO @EnisTaner
Dan Nathan
21 Oct 14 15:12:09
ICYMI: Monday's Notable Options Activity: $AAPL, $COV, $XLI, $JCP, $RICE http://t.co/fyeUICTnnO @EnisTaner
Harry Walkman
21 Oct 14 14:32:39
$COV Medtronic Still Desperate To Acquire Covidien http://t.co/kQhbgD4AMK
NASDAQ
21 Oct 14 14:28:41
$COV - Filing of Certain Prospectuses and Communications in Connection With Business Combination Transactions http://t.co/kZvIBb210Q
Mahmud Pirimov
21 Oct 14 13:57:29
RT @davidfaber: Covidien makes clear it is not going to be like Shire: http://t.co/MIUopPxnst $COV
StockSpotter
21 Oct 14 13:16:27
$COV up 4.5% to 89.25 bullish at a cycle trough #stocks #markets #trading http://t.co/6t6F8inQ7U
Market Int Center
21 Oct 14 12:40:34
Covidien $COV Showing Bearish Technicals With Support At $81.95 ( http://t.co/kJ3yfjo6S4 )
BNK Invest
21 Oct 14 12:24:28
Tuesday Sector Leaders: Energy, Healthcare $PSX $MPC $XLE $WAT $COV #stocks http://t.co/GkDZwV86Y2
XBanker Trader Guyer
21 Oct 14 11:26:38
RT @davidfaber: Covidien makes clear it is not going to be like Shire: http://t.co/MIUopPxnst $COV
EvaluateMedTech
21 Oct 14 11:05:51
#taxinversion changes in Ireland have not put off $MDT's $43bn acquisition of $COV http://t.co/d2BrVt5OQe
Irma Doucet
21 Oct 14 11:02:40
$COV Medtronic Still Desperate To Acquire Covidien http://t.co/O7gr1dEeJj
HotKeyTrading
21 Oct 14 11:00:04
Unusual Options Activity: Calls: $BIDU $DSX $MDLZ $NPSP $WU $COV $APOL $BWA $FLEX $SFUN $CMG $ZIOP $LNCO $STLD $ZNGA http://t.co/XQITF0lRKD
NASDAQ
21 Oct 14 10:55:06
$COV - Filing of Certain Prospectuses and Communications in Connection With Business Combination Transactions http://t.co/dVddHTKSQ9
InterCooler
21 Oct 14 10:51:07
Covidien plc Rating Reiterated by Deutsche Bank $COV http://t.co/q0WEI9c0iv
NASDAQ
21 Oct 14 10:49:05
$COV - Filing of Certain Prospectuses and Communications in Connection With Business Combination Transactions http://t.co/RUZnr5E4L1
Squawk on the Street
21 Oct 14 07:14:49
RT @davidfaber: Covidien makes clear it is not going to be like Shire: http://t.co/MIUopPxnst $COV
danprimack
21 Oct 14 07:09:12
RT @davidfaber: Covidien makes clear it is not going to be like Shire: http://t.co/MIUopPxnst $COV
DAVID FABER
21 Oct 14 07:08:42
Covidien makes clear it is not going to be like Shire: http://t.co/MIUopPxnst $COV
FierceMedicalDevices
21 Oct 14 07:03:11
Q&A: CMO says Covidien wants to engage parallel review process http://t.co/PhKDg67uaA $COV by @VarunSaxena2
The Fly
21 Oct 14 06:52:24
$COV $MDT $SHPG $ABBV Covidien rises after Medtronic maintains merger date language: Full Story http://t.co/W0KDJvWAJr
zach
21 Oct 14 06:33:07
$MDT BOD unanimously backed $COV deal after review of proposed inversion rules on oct 2 http://t.co/mwCzIl4QVK
Option Alert
21 Oct 14 06:01:22
Largest open interest increases among single stock options for 10/21 include $AAPL, $COV, $YHOO, $BAC, and $BBRY.
Dan Nathan
21 Oct 14 05:12:04
Monday's Notable Options Activity: $AAPL, $COV, $XLI, $JCP, $RICE http://t.co/fyeUICTnnO @EnisTaner
Russell Barbour
21 Oct 14 00:09:35
Big Trader In The News - Shocking! Video testimonials! http://t.co/cGxGfd9Spy $WLB $COV $CDNS $NUAN $RUSL $BIIB $ATHN
SH
20 Oct 14 22:33:19
Unusual Option Vol $EFA $BBRY $COV $XLI $IBM $SHLD $AIG $HRB $CMG $ABBV http://t.co/BRS9dFF7Is
holycharts
20 Oct 14 20:00:03
Buy-signal detected for 8 stocks: $SNA $AMGN $DVA $KSS $STZ $COV $ABT $TGT
Tom Silver
20 Oct 14 19:57:36
Rbc" $COV Deal Spread Has Blown Out Post $ABBV/Shire. Risk/Reward Is Now More Favorable. TP=$95…."
HotKeyTrading
20 Oct 14 18:00:03
Popular Stock Picks By Consensus: $COV $NKE $BBBY $MRK $GILD $BIDU $BRCD $NLY $ATVI $T $SYMC $AXP $MET $EMC $CMCSA http://t.co/Vv2VEn80mr
12Stocks.com
20 Oct 14 16:02:28
S&P500 #Stocks Performance $TSO $LUV $GCI $HAS $DAL $CELG $QEP $COV $GMCR $IP $NFX $LEN $EXPE $MNST $HP more@ http://t.co/RPeaHBZz9y
Karl banks
20 Oct 14 15:42:35
RT @wizzwatch: Top 10 S&P 500 Movers: $TSO, $JCP, $LUV, $GCI, $HAS, $DAL, $CELG, $QEP, $COV, $IP .....
wizzwatch
20 Oct 14 15:28:49
Top 10 S&P 500 Movers: $TSO, $JCP, $LUV, $GCI, $HAS, $DAL, $CELG, $QEP, $COV, $IP .....
Donnie Sanson
20 Oct 14 12:05:53
Call/Put Highest % volume changes: Calls: $WU, $SHLD, $XLI, $GNC, $DNKN. Puts: $AEO, $COV, $HRB, $SFLY, $XRX.
Market Int Center
20 Oct 14 11:58:57
Potential Covidien $COV Trade Has 10.95% Downside Protection ( http://t.co/S3VBC6HrAi )
Lightspeed
20 Oct 14 11:54:04
Call/Put Highest % volume changes: Calls: $WU, $SHLD, $XLI, $GNC, $DNKN. Puts: $AEO, $COV, $HRB, $SFLY, $XRX.
FonsieTrader
20 Oct 14 11:47:25
$COV Option Alert: Heavy Interest In Jan 15 $57.5/$75 Puts; 82,540 Traded vs 7764 OI; Currently $84
NASDAQ
20 Oct 14 11:43:03
$COV - Filing of Certain Prospectuses and Communications in Connection With Business Combination Transactions http://t.co/XuXu3BpVc7
Antoine Gara
20 Oct 14 11:21:26
Nice scoop from @ozoran /Paulson's top holding is Shire. $AGN, $COV also large positions. Dumped $ABBV on Oct 16. http://t.co/OTaMgmvhTs
Livevol Community
20 Oct 14 10:14:04
Block Trade: 12:58 $COV Jan17'15 57.5 P (PHLX) 0.85 40000x Today's Full Report: http://t.co/Ln5Z8kw13R
Livevol Community
20 Oct 14 10:14:03
Block Trade: 12:58 $COV Jan17'15 75 P (PHLX) 4.40 40000x Today's Full Report: http://t.co/Ln5Z8kw13R
Livevol Community
20 Oct 14 09:00:04
HIGH CALL VOLU $XLI 1010% $COV 703% $DNKN 700% $ENB 617% $EQR 613% $ALTR 495% $DLR 487% $LGF 426% http://t.co/gwzPxhnztr
George Avidon
20 Oct 14 08:32:24
RT @TheTradeXchange: $COV Jan 95calls 4k @$2.00
Trader News Daily
20 Oct 14 08:26:24
Check out http://t.co/sJnBwtOUTE for stock trading website reviews. Related: $HBAN $QEP $MGM $JPM $COV $GTATQ $XOM $RIG $ABEV $KEY $UAL
TradeXchange
20 Oct 14 08:17:17
$COV Jan 95calls 4k @$2.00
Точка Входа.Трейдинг
20 Oct 14 07:22:47
$COV long 84.01
Angry Arb
20 Oct 14 07:19:59
$COV Rule 8.3 filings is the HF equivalent of Mad Max Thunderdome - 2 men enter, 1 man leaves...
Ben C. Becker
20 Oct 14 06:49:05
Buying $COV this a.m. Merger Arb play, believe $MDT remains committed to the deal. #Timestamped
HotKeyTrading
20 Oct 14 06:00:03
Popular Stock Picks By Consensus: $COV $NKE $BBBY $MRK $GILD $BIDU $BRCD $NLY $ATVI $T $SYMC $AXP $MET $EMC $CMCSA http://t.co/Vv2VEn80mr
Harry Walkman
20 Oct 14 05:01:49
$COV Latest Updates on Covidien plc (NYSE:COV) http://t.co/6l8V5VcoSh
Ithaca Partners
20 Oct 14 04:52:54
Commented on: "Covidien PLC - 11.6% Upside: Out Of The Gate, Too Late To Catch" http://t.co/mM5rqmZgwj $COV $MDT
Точка Входа.Трейдинг
20 Oct 14 02:45:07
In Play / / $HAL $GNC $URBN $COV $SNDK $MJN / / #трейдинг #nyse #nasdaq #биржа
				
				
By  +Follow December 9, 2013 7:38AM
Share:

Comments

 

blog comments powered by Disqus

About us

Equities.com is the most advanced interactive online social ecosystem for the financial industry, serving as a resource center and next-generation communication platform that connects self-directed investors with public issuers, market experts, and professional service providers and vendors. Registered members can leverage our exclusive proprietary research tools such as the Small-Cap Stars, which outperformed 90% of all small-cap mutual funds, and robust do-it-yourself E.V.A. research reports. The Equities.com Issuer Dashboard is the ideal tool to communicate and manage investor awareness campaigns to the investment community, as well as to access valuable resources to help your company grow.

Market Data powered by QuoteMedia.
Copyright © QuoteMedia. Data delayed 15 minutes unless otherwise indicated. Terms of Use.