Medtronic 2015 Annual Report Download - page 94

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Medtronic plc
Notes to Consolidated Financial Statements (Continued)
transaction value was approximately $238 million. Based upon a preliminary acquisition valuation, the Company acquired $159
million of customer-related intangible assets and tradenames with an estimated useful life of 20 years at the time of acquisition
and $197 million of goodwill. The acquired goodwill is not deductible for tax purposes. During fiscal year 2015, the Company
recorded adjustments to goodwill, other intangible assets, net, and long-term deferred tax liabilities.
Sapiens Steering Brain Stimulation
On August 25, 2014, the Company acquired Sapiens Steering Brain Stimulation (Sapiens), a privately-held developer of deep
brain stimulation technologies. Total consideration for the transaction was approximately $203 million. Based upon a
preliminary acquisition valuation, the Company acquired $30 million of IPR&D and $170 million of goodwill. The acquired
goodwill is not deductible for tax purposes.
Visualase, Inc.
On July 25, 2014, the Company acquired Visualase, Inc. (Visualase), a privately-held developer of minimally invasive MRI
guided laser ablation for surgical applications. Total consideration for the transaction was approximately $97 million. Based
upon a preliminary acquisition valuation, the Company acquired $66 million of technology-based intangible assets with an
estimated useful life of 10 years at the time of acquisition and $43 million of goodwill. The acquired goodwill is not deductible
for tax purposes. During fiscal year 2015, the Company recorded minor adjustments to goodwill and other assets.
Corventis, Inc.
On June 20, 2014, the Company acquired Corventis, Inc. (Corventis), a privately-held developer of wearable, wireless
technologies for cardiac disease. Total consideration for the transaction was approximately $131 million, including settlement of
outstanding debt to Medtronic of $50 million. Based upon the acquisition valuation, the Company acquired $80 million of
technology-based intangible assets with an estimated useful life of 16 years at the time of acquisition and $48 million of
goodwill. The acquired goodwill is not deductible for tax purposes. During fiscal year 2015, the Company recorded minor
adjustments to goodwill and long-term deferred tax liabilities.
The Company accounted for the acquisitions of Sophono, Diabeter, NGC, Sapiens, Visualase, and Corventis as business
combinations using the acquisition method of accounting.
Subsequent Acquisitions
On June 18, 2015, the Company acquired CardioInsight Technologies, Inc (CardioInsight), a privately-held medical device
company that has developed a new approach to improve the mapping of electrical disorders of the heart. Consideration
consisted of an initial cash payment of $75 million, and retirement of a Medtronic loan outstanding to CardioInsight in the
amount of $25 million, plus performance-based contingent consideration that may be paid post-closing.
On June 19, 2015, the Company acquired Aptus Endosystems, Inc. (Aptus), a privately-held medical device company focused
on developing advanced technology for endovascular aneurysm repair and thoracic endovascular aneurysm repair. The total
consideration for the transaction was approximately $110 million.
Other Acquisitions and Acquisition-Related Items
On December 19, 2014, the Company acquired a business in the Neuromodulation division. Total consideration for the
transaction was approximately $39 million, which included an upfront payment of $33 million and the estimated fair value of
revenue-based contingent consideration of $6 million. Based upon a preliminary acquisition valuation, the Company acquired
$39 million of IPR&D. The Company accounted for the acquisition as a business combination using the acquisition method of
accounting.
During fiscal year 2015, the Company recorded charges from acquisition-related items of $550 million, primarily related to
costs incurred in connection with the Covidien acquisition. The charges incurred in connection with the Covidien acquisition
include $275 million of professional services and integration costs, $189 million of accelerated or incremental stock
compensation expense, and $69 million of incremental officer and director excise tax. These amounts are included within
acquisition-related items in the consolidated statements of income.
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