Physio-Control had $425 million in net sales in fiscal year 2011. According to a recent Deustche Bank report, the unit had been struggling for a number of years.
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Gabelli analyst Jeff Jonas noted that Physio-Control had been a sale prospect for the last two or three years because it was a non-core business and had unfavorable margins.Bain had purchased Physio-Control in 1994 from Eli Lilly(LLY) and taken it public the next year; Medtronic purchased Physio-Control in 1998 for $535 million. "While Physio-Control has played an important role in complementing Medtronic's continuum of therapies for cardiac patients, it was recognized long ago that it is best for both Medtronic and Physio-Control to operate as separate companies, each fully focused on their respective strengths and opportunities," Medtronic spokesman Christopher Garland said.The Physio-Control deal is expected to close in the first quarter of 2012. The company's president, Brian Webster, is expected to stay in that role and be named CEO after the deal is completed. >To submit a news tip, send an email to: tips@thestreet.com.
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