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

By  +Follow December 9, 2013 7:38AM
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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. To read our full disclosure, please go to: http://www.equities.com/disclaimer


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Results for COV
PennyStock Zone
24 Apr 15 18:09:43
Review of Timothy Sykes book: An American Hedge Fund: http://t.co/HMYdF92FUf $RFMD $IYT $MERC $GASL $COV $RH
SmallCaps
24 Apr 15 11:56:17
Review of Timothy Sykes book: An American Hedge Fund: http://t.co/AKjszqM28B $RFMD $IYT $MERC $GASL $COV $RH
Daily Contracts
24 Apr 15 10:06:04
Real-Time feed of company contracts, original agreements and executive updates from $COV http://t.co/7sENsarx1h
PennyStock Zone
24 Apr 15 04:26:22
Review of Timothy Sykes book: An American Hedge Fund: http://t.co/HMYdF92FUf $RFMD $IYT $MERC $GASL $COV $RH
HedgeMind
23 Apr 15 21:01:02
Phill Gross's top 10 healthcare stock picks include $PBYI $COV $MNK $BMY $JNJ $AGN $PFE $VRTX $MRK $GILD http://t.co/37CE8O3NM7
PennyStock Zone
23 Apr 15 19:14:28
Review of Timothy Sykes book: An American Hedge Fund: http://t.co/HMYdF92FUf $RFMD $IYT $MERC $GASL $COV $RH
SmallCaps
23 Apr 15 18:26:35
Review of Timothy Sykes book: An American Hedge Fund: http://t.co/AKjszqM28B $RFMD $IYT $MERC $GASL $COV $RH
bericher
23 Apr 15 16:15:10
RT @fonzerrellie: @BittrexExchange $COV dev has updated the COV wallet could you please update, a great new coin for sure, thanks for havin…
Soumitra Mandhata
23 Apr 15 16:03:41
RT @rhian_is: OK, in amongst the general mirth, added $SLING $LUX $HUGE $CF $GLIDE $COV to http://t.co/SbNqQEyRjG tonight #cryptocurrency #…
Count My Crypto
23 Apr 15 16:02:30
RT @rhian_is: OK, in amongst the general mirth, added $SLING $LUX $HUGE $CF $GLIDE $COV to http://t.co/SbNqQEyRjG tonight #cryptocurrency #…
Rhian Lewis
23 Apr 15 16:02:05
OK, in amongst the general mirth, added $SLING $LUX $HUGE $CF $GLIDE $COV to http://t.co/SbNqQEyRjG tonight #cryptocurrency #altsareback
fonzerrellie
23 Apr 15 14:49:01
@BittrexExchange $COV dev has updated the COV wallet could you please update, a great new coin for sure, thanks for having it
Insider Monkey
23 Apr 15 10:25:22
How QVT Financial Gained from $LL’s 53% Drop in Q1 http://t.co/ApomOA6ZMe $AEHR, $LL, $MDT, $COV, $HALO, $MMYT
John Ablemann
23 Apr 15 07:01:44
$COV Covidien plc. (COV) Ex-Dividend Date Scheduled for December 30, 2014 http://t.co/Au4SrPyvWM
James P Worthy
23 Apr 15 06:06:51
$COV Medtronic finalizes $42.9b Covidien deal http://t.co/3Z4ql1wmIu
Irma Doucet
23 Apr 15 06:06:49
$COV Covidien plc. (COV) Ex-Dividend Date Scheduled for December 30, 2014 http://t.co/X74fb9Owzb
PennyStock Zone
23 Apr 15 04:59:03
Review of Timothy Sykes book: An American Hedge Fund: http://t.co/HMYdF92FUf $RFMD $IYT $MERC $GASL $COV $RH
BitXBit.in
23 Apr 15 01:59:32
some People dump $COV on trex for they profit , see the supply , dev active and… http://t.co/9vIBh0V7ia #bitXbit http://t.co/SY4emlOxNR
Trade2Winner EX
23 Apr 15 01:56:06
some People dump $COV on trex for they profit , see the supply , dev active and this week release the roadmap , cant wait #bitcoin
Trade2Winner EX
23 Apr 15 01:50:15
$COV coin updtae the website , 1-2 day again Release the roadmap , supply just 33k , Dont late #Bitcoin #covencoin
Trade2Winner EX
23 Apr 15 01:35:03
RT @WorldCoinIndex: #Coven $COV now on http://t.co/bTJPub3BLF
husnia farita
23 Apr 15 01:14:04
@ExgeoCom @BittrexExchange $COV COIN it's really2 amazing , see the supply n wait to boom #Bitcoin #Altcoin
Trade2Winner EX
23 Apr 15 01:09:24
$COV live on @bittrexexchange Just 33k Supply , Dev Active and now see the price so Low , Buy Now = Cheap #bitcoin #Ltc #Dash
bericher
22 Apr 15 22:40:47
@jonwucrypto $cov already death.sadness
Kupo
22 Apr 15 19:31:51
Made 350% on $COV before dumpers responded to my tweet in kind though, so that's nice.
Jonathan Wu
22 Apr 15 10:47:27
picked up some $SLING and a small amount of $8BIT, anticipating a exit pump. keeping a eye on $COV.
PennyStock Zone
22 Apr 15 09:53:15
Review of Timothy Sykes book: An American Hedge Fund: http://t.co/HMYdF9khiP $RFMD $IYT $MERC $GASL $COV $RH
L_Ron_Fuddard
22 Apr 15 08:36:35
$NTRN yesterday, $8BIT today, which of the weekend's pumps is next to fall? $COV $SLING $TRON
Kupo
22 Apr 15 07:37:49
I'm done accumulating $COV https://t.co/3D5N1rYqkc Have at it.
#Altcoin Devvie
22 Apr 15 07:37:09
RT @wigitgetit: Check the @CovenCoin @bitcointalk Thread https://t.co/fni1xX5dH5 People are Really #Digging the #PoS Only 33k Supply Active…
Jeffrey Blake
22 Apr 15 07:36:38
$COV Medtronic finalizes $42.9b Covidien deal http://t.co/XVSHik2eXf
James P Worthy
22 Apr 15 07:36:34
$COV Covidien plc. (COV) Ex-Dividend Date Scheduled for December 30, 2014 http://t.co/3uDvp1p3m9
Just Don't Stop
22 Apr 15 07:32:09
Check the @CovenCoin @bitcointalk Thread https://t.co/fni1xX5dH5 People are Really #Digging the #PoS Only 33k Supply Active Coin Dev $COV
Kids Dynamite
22 Apr 15 04:56:16
RT @allyouracid: Today's top coins: $ARCH $TRON $SLING $SDC $DASH $CANN $XBS $CRAVE $COV $XSEED $NTRN $8BIT $BSTY $OCUPY - http://t.co/8bBA…
#Altcoin Devvie
22 Apr 15 00:39:10
RT @WorldCoinIndex: #Coven $COV now on http://t.co/bTJPub3BLF
MemoryShock
21 Apr 15 23:12:17
RT @cryptofull: $COV #COV upcoming features: Masternodes, Stealth Integration, EncryptedMessaging, Indistinguishability Obfuscator https://…
CryptoFull
21 Apr 15 20:14:19
$COV #COV upcoming features: Masternodes, Stealth Integration, EncryptedMessaging, Indistinguishability Obfuscator https://t.co/kiyG0v4eOI
allyouracid
21 Apr 15 20:05:13
Today's top coins: $ARCH $TRON $SLING $SDC $DASH $CANN $XBS $CRAVE $COV $XSEED $NTRN $8BIT $BSTY $OCUPY - http://t.co/8bBAFj5oWE
Just Don't Stop
21 Apr 15 19:09:11
@CovenCoin Is Now on @CoinMKTCap http://t.co/7p2F15lCkW Visit the @bitcointalk https://t.co/FRoASvGrGc $COV http://t.co/n2Fg7IZDZf
Just Don't Stop
21 Apr 15 19:05:42
RT @CryptoCc: Bought back in on $Crave, price looks good, and clones everywhere indicate value. Also little $COV & $SLING just in case
BlueRockCrypto
21 Apr 15 19:01:17
RT @CryptoCc: Bought back in on $Crave, price looks good, and clones everywhere indicate value. Also little $COV & $SLING just in case
CryptoCC
21 Apr 15 16:59:50
RT @wigitgetit: @CovenCoin Thank You for the update. https://t.co/yMaa1PBMuX Encrypted Messaging + #MOAR $COV @Vindyne8 @SuchPool http://t…
Just Don't Stop
21 Apr 15 16:43:57
@WorldCoinIndex Thank You for Adding $COV @bitcointalk for @CovenCoin https://t.co/FRoASvGrGc http://t.co/mKQeGZo6M7
SuchPool
21 Apr 15 16:42:53
RT @wigitgetit: $COV @WorldCoinIndex http://t.co/Z12Foqmemb #Trade @BittrexExchange https://t.co/pei9mSTzXd https://t.co/FRoASvGrGc http://…
Just Don't Stop
21 Apr 15 16:41:13
RT @WorldCoinIndex: #Coven $COV now on http://t.co/bTJPub3BLF
SmallCaps
21 Apr 15 16:39:36
Review of Timothy Sykes book: An American Hedge Fund: http://t.co/AKjszqurh3 $RFMD $IYT $MERC $GASL $COV $RH
Just Don't Stop
21 Apr 15 16:39:07
$COV @WorldCoinIndex http://t.co/Z12Foqmemb #Trade @BittrexExchange https://t.co/pei9mSTzXd https://t.co/FRoASvGrGc http://t.co/RZXjyBFmxy
CryptoCC
21 Apr 15 16:22:28
$VNL looking great, glad I held strong! $COV dev delivering too, awesome! $CRAVE started uptrending after I bought in :)
Just Don't Stop
21 Apr 15 15:52:51
@CovenCoin Thank You for the update. https://t.co/yMaa1PBMuX Encrypted Messaging + #MOAR $COV @Vindyne8 @SuchPool http://t.co/eoT9tsYoso
Dogecoin
21 Apr 15 14:30:55
RT @crypto_dealer: $ASN has a nice roadmap too worth investing in again :) $BTC $TRON $CRAVE $SDC $8BIT $COV
				
				
By  +Follow December 9, 2013 7:38AM
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