Covidien said Monday it was buying superDimension Ltd., an Israeli company that makes a bronchoscope with GPS-like tracking technology, for about $300 million.
The deal, which also includes future payouts based on performance, is expected to wrap up in the second quarter.
superDimension makes the i-Logic Electromagnetic Bronchoscopy system, a bronchoscope that uses electromagnetic navigation technology to be tracked as it snakes through the lungs. Once in the lungs, the device can take images or biopsy samples, place markers for radiation therapy or surgery, and even deliver treatments, according to a superDimension's brochure. The device is meant to help doctors find small lesions in the deep lungs without resorting to surgery, the company said.
Health care investment bank Leerink Swann dubbed the buy a "small add-on" that was "positive longer-term."
"Though unlikely to move the needle on COV in the short term, longer term this transaction could add a differentiated platform in a growing market (lung biopsies) that is leverageable through COV's extensive global sales & marketing infrastructure," Rick Wise, an analyst with the group, told investors in an e-mail note.
Covidien said the purchase would be "slightly dilutive" to fiscal 2012 earnings per share, but that this would be mostly offset by the "underlying strength" of existing businesses.
Once the acquisition is complete, Covidien said superDimension would be enfolded in the endomechnical line of the company's medical device division.
SuperDimensino, which Covidien says has annual sales of about $30 million, is based in Herzliya, Israel.