Medtronic 2014 Annual Report Download - page 90

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Medtronic, Inc.
Notes to Consolidated Financial Statements (Continued)
Fiscal Year 2012
Salient Surgical Technologies, Inc.
On August 31, 2011, the Company acquired Salient Surgical Technologies, Inc. (Salient). Salient develops and markets devices
for haemostatic sealing of soft tissue and bone incorporating advanced energy technology. Salient’s devices are used in a variety
of surgical procedures including orthopedic surgery, spine, open abdominal, and thoracic procedures. Total consideration for the
transaction was approximately $497 million. Medtronic had previously invested in Salient and held an 8.9 percent ownership
position in the company. Net of this ownership position, the transaction value was approximately $452 million. Based upon the
acquisition valuation, the Company acquired $154 million of technology-based intangible assets that had an estimated useful
life of 12 years, $44 million of IPR&D, and $348 million of goodwill. The IPR&D primarily relates to the launch of Salient’s
concentric wire product. The acquired goodwill is not deductible for tax purposes.
The Company accounted for the acquisition of Salient as a business combination using the acquisition method of accounting.
The assets acquired and liabilities assumed were recorded at their respective fair values as of the acquisition date. The fair
values of the assets acquired and liabilities assumed are as follows:
(in millions)
Current assets $20
Property, plant, and equipment 11
IPR&D 44
Other intangible assets 154
Goodwill 348
Other assets 1
Total assets acquired 578
Current liabilities 43
Long-term deferred tax liabilities, net 38
Total liabilities assumed 81
Net assets acquired $ 497
PEAK Surgical, Inc.
On August 31, 2011, the Company acquired PEAK Surgical, Inc. (PEAK). PEAK develops and markets tissue dissection
devices incorporating advanced energy technology. Total consideration for the transaction was approximately $113 million.
Medtronic had previously invested in PEAK and held an 18.9 percent ownership position in the company. Net of this ownership
position, the transaction value was approximately $96 million. Based upon the acquisition valuation, the Company acquired
$74 million of technology-based intangible assets that had an estimated useful life of 12 years, and $56 million of goodwill. The
acquired goodwill is not deductible for tax purposes.
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