October 30, 2013 | By Anabela Farrica
Covidien announced yesterday that it has reached an agreement with Integra LifeSciences Corporation to sell its Confluent Surgical product line for $235 million in up-front cash, plus an additional $30 million in milestones. The transaction depends on a number of regulatory approvals, but it is expected to be finished by March 31, 2014.
The Confluent line involves a set of soft-tissue repair tools, including: DuraSeal™, DuraSeal™ Exact/Xact, VascuSeal™ and SprayShield™. It was first acquired by Covidien in 2006, when the Massachussets-based device manufacturer was still known as the U.S. Surgical division of Tyco international. Prior to that, the line had already been launched in 1998 by its inventor, Amar Sawhney.
According to Covidien, this sale arises under the light of the company’s cost containment measures and refocus on the higher growth segments. This means expanding to emerging markets and invest in promising areas, such as renal denervation and peripheral artery disease. On the other side of the deal, Integra hopes these acquisitions will reinforce their global Neurosurgery growth. Confluent products are expected to generate $57 million to $60 million in revenue during the first year alone, followed by a 3% to 5% annual growth in the subsequent years.