Medtronic Buys Privately-Held Sapiens For $200 Mln.

(RTTNews) - Medtronic Inc. (MDT) Tuesday said it has acquired Sapiens Steering Brain Stimulation, a privately-held developer of deep brain stimulation technologies, for about $200 million in cash.

The Minneapolis, Minnesota-based medical equipment maker aims to improve its offerings in the field of brain function modulations through this acquisition. Medtronic said the deal does not impact its earnings guidance for fiscal year 2015, but is expected to meet its long-term financial metrics.

Eindhoven, Netherlands-based Sapiens is developing a deep brain stimulation or DBS system that features an advanced DBS lead with 40 individual stimulation points, Medtronic said. Sapiens will continue to work on the project to bring the technology to market. Sapiens will serve as Medtronic's global research and development center for its Neuromodulation business.

"This acquisition broadens our neuroscience leadership position with innovative brain modulation technology that, along with our comprehensive portfolio of DBS solutions, may one day transform the way physicians are able to treat patients with neurodegenerative diseases like Parkinson's disease and essential tremor," said Lothar Krinke, VP of Brain Modulation business at Medtronic.

This small acquisition comes at a time when Medtronic strives to complete the $43 billion acquisition of its smaller rival Covidien plc (COV), which will help Medtronic to shift its base to Ireland and save it from paying high U.S. corporate taxes.

Several U.S. healthcare companies, are increasingly looking at inversions as an option to escape the high rate of corporate taxes in the U.S., which is among the highest in the world, as the U.S. overhauls its healthcare system under the Affordable Care Act. The statutory tax rate in the U.S. is currently 35 percent, while it is 12.5 percent in Ireland.

MDT is currently trading at $63.80, up $0.17 or 0.27%, on the NYSE.