Covidien To Sell Confluent Surgical Product Line To Integra LifeSciences

(RTTNews) - Covidien (COV) said Monday that it has entered into a definitive agreement with Integra LifeSciences Corp. to sell its Confluent Surgical product line. The deal is expected to close by March 31, 2014.

Under the terms of the agreement, Covidien will receive an initial cash payment of $235 million from Integra upon the closing of the deal. Additionally, Covidien may receive up to $30 million, contingent upon the achievement of certain performance measures related to the transition of the Confluent Surgical business to Integra.

Confluent Surgical products include: DuraSeal, DuraSeal Exact/Xact, VascuSeal and SprayShield. Those products are part of the soft tissue repair category of Covidien's Medical Devices business and generated about $65 million in sales in fiscal 2012.

Assuming a closing on or before March 31, 2014, Covidien expects the deal to be several cents dilutive to fiscal 2014 earnings per share; however, the underlying strength of Covidien's existing businesses is expected to offset this dilution.

As a result, Covidien does not anticipate the deal to have a material impact on its fiscal 2014 outlook.