SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 2, 1998
Medtronic, Inc.
(Exact name of Registrant as Specified in its Charter)
Minnesota
(State or Other Jurisdiction of Incorporation)
1-7707 41-0793183
(Commission File Number) (IRS Employer
Identification No.)
7000 Central Avenue N.E.
Minneapolis, Minnesota 55432-3576
(Address of Principal Executive Offices and Zip Code)
(612) 514-4000
(Registrant's telephone number, including area code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events
On November 2, 1998, the Registrant issued a press release announcing
the signing of a merger agreement to acquire Sofamor Danek Group, Inc. Subject
to the terms and conditions of the merger agreement, shares of SDG will be
converted into shares of the Registrant pursuant to the conversion ratio set
forth therein and described in the press release. There are outstanding
approximately 27 million SDG shares and options to acquire approximately 5.5
million SDG shares. The full text of the press release is set forth in Exhibit
99 attached hereto and is incorporated in this Report as if fully set forth
herein.
Item 7. Financial Statements and Exhibits
Exhibit 99. Press release dated November 2, 1998.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MEDTRONIC, INC.
By /s/ Robert L. Ryan
Date November 9, 1998 Robert L. Ryan
Senior Vice President and Chief
Financial Officer
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EXHIBIT INDEX
Medtronic, Inc.
Form 8-K Current Report
Dated November 2, 1998
Exhibit Number Description
99 Press release dated November 2, 1998
Exhibit 99
Contacts:
Sofamor Danek: Medtronic:
George Griffin Chris O'Connell
Chief Financial Officer Investor Relations
901/396-2695 612/514-4971
Dick Reid
Public Relations
612/514-3052
Jessica Stoltenberg
Public Relations
888/731-6434
F O R I M M E D I A T E R E L E A S E
MEDTRONIC AND SOFAMOR DANEK AGREE TO MERGE AS GLOBAL LEADER
IN NEUROLOGICAL AND SPINAL MEDICAL TECHNOLOGIES
MINNEAPOLIS, MN, November 2, 1998 -- Medtronic, Inc. (NYSE: MDT), and
Sofamor Danek Group, Inc. (NYSE: SDG), today announced a merger agreement that
will transform Medtronic into the global leader in advanced medical technologies
for the treatment of neurological and spinal disorders. The agreement calls for
Medtronic to exchange $115 in Medtronic stock for each share of Sofamor Danek.
The agreement is subject to certain collar provisions.
"The merger with Sofamor Danek considerably broadens and strengthens
Medtronic's market position and technology in the spinal and neurosurgery
field," said William W. George, Medtronic chairman and chief executive officer.
"Sofamor Danek has established itself in the leadership role by its
extraordinary customer service and exceptional products. Combined with Sofamor
Danek, Medtronic's neurological and spinal product line will be over $1 billion
in revenues next fiscal year, growing at 25 percent a year as we move into the
21st century. Sofamor Danek's 1998 revenues are expected to approach $400
million on a worldwide basis."
Sofamor Danek is the leader in the $850 million worldwide market for
technologies used by spine surgeons. It is estimated that more than 5 million
people suffer from debilitating back pain and that more than 275,000 surgical
procedures are performed each year. The company produces a number of products
that treat a variety of disorders of the cranium and spine, including
traumatically induced conditions, degenerative conditions, deformities and
tumors. Its product offerings include:
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o a wide range of sophisticated internal fixation devices, including
interbody fusion systems, and services for the distribution of
autologous bone dowels;
o the Med(TM) MicroEndoscopic Discectomy System used for the surgical
removal of vertebral discs; and
o the Stealthstation(R) System which leads a family of image-guided
surgical navigation products that precisely target operating sites for
cranial and spinal procedures.
Among developmental products are biologics, such as bone morphogenetic
proteins, other bone growth factors, and autologous derivatives (bone paste),
that enhance healing following reconstructive procedures.
"The product lines of Medtronic and Sofamor Danek are highly
complementary. By combining the technology, service and energy of the two
companies, we will be able to develop new and better solutions more quickly and
deliver these solutions to doctors and their patients faster, more
cost-effectively, and with better customer support. As a result, both our
customers and our shareholders will benefit," said E.R. Pickard, chairman and
chief executive officer of Sofamor Danek.
Medtronic's new neurological and spinal business will be led by John
Meslow as its president. Pickard will continue to lead Sofamor Danek, reporting
to Meslow and will eventually assume responsibility for all of Medtronic's
neurosurgery businesses including PS Medical and recently acquired Midas Rex.
Other businesses reporting to Meslow include neurostimulation, drug delivery,
and functional stimulation and diagnostics.
"The spinal and cranial surgery businesses represent a major new growth
platform for Medtronic that will complement our existing growth platforms in
neurosurgery, neurostimulation and drug delivery," said Meslow.
Medtronic said that, aside from one-time transaction-related charges,
the merger will be neutral to current year earnings and add several cents a
share in FY 2000, becoming increasingly accretive in the following years. The
transaction is structured as a tax-free pooling of interests.
The $115 per share acquisition price stated above applies if
Medtronic's average common stock price for the 15 NYSE trading days ending on
and including the second NYSE trading day preceding the Sofamor Danek
shareholders' meeting on the merger is between $69.63 and $56.97 per share. If
such average is within this range, then each Sofamor Danek share will be
exchanged for Medtronic shares with a value of $115. If such average Medtronic
stock price is equal to or greater than $69.63 then each Sofamor Danek share
will be exchanged for 1.65159 Medtronic shares, and if it is equal to or less
than $56.97 then each Sofamor Danek share will be exchanged for 2.01861
Medtronic shares.
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The transaction is subject to Sofamor Danek shareholder approval,
regulatory approvals and other customary closing conditions. The directors of
the company have agreed to vote unanimously in favor of the merger.
Headquartered in Memphis, TN, Sofamor Danek Group, Inc., employs about
1,200 and operates manufacturing facilities in Warsaw, IN; Broomfield, CO; West
Palm Beach, FL; and Rang-du-Fliers, France. Its Internet address is
www.sofamordanek.com.
Medtronic, Inc., headquartered in Minneapolis, is the world's leading
medical technology company specializing in implantable and interventional
therapies. Its Internet address is www.medtronic.com.
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Any statements made about the company's anticipated financial results are
forward-looking statements subject to risks and uncertainties such as those
described in the company's Annual Report on Form 10K for the year ended April
30, 1998. Actual results may differ materially from anticipated results.
