Irish medical supplies company Covidien PLC, which has its US headquarters in Mansfield and employs about 1,800 people in Massachusetts, said it has agreed to buy an Israeli company as part of its plan to expand its presence in the multibillion dollar gastrointestinal market.
In a transaction valued at about $860 million, Covidien said that it plans to buy Given Imaging Ltd., a company whose product line includes PillCam, a small endoscope that can be swallowed in a capsule.
Covidien has identified the gastrointestinal, or GI, market as a key area for potential growth. It has recently made several smaller acquisitions of companies that specialize in GI treatments, and the purchase of Given Image will provide it with diagnostic products for the market, the company said.
“We believe GI is one of the most attractive specialty procedure areas,” Bryan Hanson, group president of the Covidien’s medical devices and US unit, said in a statement. “Acquiring Given will enable Covidien to significantly expand its presence in a $3 billion GI market. Adding Given’s portfolio of diagnostics to our portfolio accelerates Covidien’s strategy of providing physicians with products that support the patient along the care continuum from diagnosis to treatment. It also confirms our leadership in developing less-invasive screening, diagnosis, and treatment solutions that can improve patient outcomes and lower health care costs.”
The transaction is expected to be completed by March 31, Covidien said.
With $10.2 billion in annual revenues, Covidien employs more than 38,000 people worldwide.
Last month, Covidien said it was shedding nearly 150 jobs worldwide, including about 70 in Mansfield as part of a five-year plan to cut costs.
Covidien, incorporated in Dublin, is the former Tyco HealthCare, which was divested by parent Tyco International Ltd. in 2007.
Over the past five years, Covidien has acquired more than a dozen mostly small medical device and supplies companies around the world.
In a major strategic move, the company in July completed the spinoff of its large pharmaceuticals division. That business now operates as Mallinckrodt Pharmaceuticals, with its headquarters in Dublin and its US home office in St. Louis.