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Table of Contents
Medtronic plc
Notes to Consolidated Financial Statements (Continued)
80
The historical consolidated financial information of the Company and Covidien has been adjusted in the pro forma information
to give effect to pro forma events that are (1) directly attributable to the transaction, (2) factually supportable, and (3) expected to
have a continuing impact on the combined results. In order to reflect the occurrence of the acquisition on April 27, 2013 as required,
the unaudited pro forma results include adjustments to reflect, among other things, the amortization of the inventory step-up, the
incremental intangible asset amortization to be incurred based on the values of each identifiable intangible asset, and interest
expense from debt financing obtained to fund the cash consideration transferred. Pro forma adjustments were tax-effected at the
Company's statutory rate. These pro forma amounts are not necessarily indicative of the results that would have been obtained if
the acquisition had occurred as of the beginning of the period presented or that may occur in the future, and does not reflect future
synergies, integration costs, or other such costs or savings.
Fiscal Year 2016
The fair values of the assets acquired and liabilities assumed from acquisitions during fiscal year 2016 are as follows:
(in millions) Twelve, Inc. RF Surgical
Systems, Inc. Medina Medical All Other Total
Other current assets $ 60 $ 40 $ 11 $ 134 $ 245
Property, plant, and equipment — 2 — 39 41
IPR&D 192 — 122 143 457
Other intangible assets — 115 — 199 314
Goodwill 291 135 126 304 856
Other assets — 2 — 15 17
Total assets acquired 543 294 259 834 1,930
Current liabilities 37 27 6 91 161
Long-term deferred tax liabilities, net 34 27 34 53 148
Other liabilities — — — 50 50
Total liabilities assumed 71 54 40 194 359
Net assets acquired $ 472 $ 240 $ 219 $ 640 $ 1,571
Twelve, Inc.
On October 2, 2015, the Company's Coronary & Structural Heart division acquired Twelve, Inc. (Twelve), a privately-held medical
device company focused on the development of a transcatheter mitral valve replacement device. Total consideration for the
transaction was approximately $472 million, which included an upfront payment of $428 million and the estimated fair value of
product development-based contingent consideration of $44 million. Based upon the acquisition valuation, the Company acquired
$192 million of IPR&D and $291 million of goodwill. The acquired goodwill is not deductible for tax purposes.
RF Surgical Systems, Inc.
On August 11, 2015, the Company's Surgical Solutions division acquired RF Surgical Systems, Inc. (RF Surgical), a medical
device company focused on the detection and prevention of retained surgical sponges. Total consideration for the transaction was
approximately $240 million. Based upon the acquisition valuation, the Company acquired $68 million of technology-based
intangible assets, $47 million of customer-related intangible assets, with estimated useful lives of 18 and 16 years, respectively,
and $135 million of goodwill. The acquired goodwill is not deductible for tax purposes.
Medina Medical
On August 31, 2015, the Company's Neurovascular division acquired Medina Medical (Medina), a privately-held medical device
company focused on commercializing treatments for vascular abnormalities of the brain, including cerebral aneurysms. Total
consideration for the transaction was approximately $219 million, which includes an upfront payment of $155 million and the
estimated fair value of revenue-based and product development-based contingent consideration of $64 million. Medtronic had
previously invested in Medina and held an 11 percent ownership position. Net of this ownership position, the transaction value
was approximately $195 million. Based upon the acquisition valuation, the Company acquired $122 million of IPR&D and $126
million of goodwill. The acquired goodwill is not deductible for tax purposes.
The Company accounted for the acquisitions of Twelve, RF Surgical, and Medina and all other acquisitions as business combinations
using the acquisition method of accounting.