Intersect ENT (XENT) - Get Intersect ENT Inc Report soared Friday after Medtronic (MDT) - Get Medtronic Plc (MDT) Report agreed to acquire the medical device company in a deal valued at about $1.1 billion.
Shares of the Menlo Park, Calif., Intersect ENT jumped nearly 12% to $27.45 at last check. Dublin-based Medtronic was up slightly to $128.13.
Medtronic said it will acquire all outstanding shares of Intersect ENT for $28.25 a share in an all-cash transaction, implying an enterprise value of about $1.1 billion.
The boards of directors of both companies have approved the deal.
Medtronic said the acquisition expands its portfolio of products used during ear, nose, and throat procedures.
Following the close, the transaction is expected to gradually increase Medtronic's weighted average market growth rate and be neutral to its adjusted earnings per share in the first twelve months and accretive after that.
The complementary product lines and customer base will further Medtronic's efforts to have a positive impact for patients who suffer from chronic rhinosinusitis, or CRS.
Intersect ENT has about 400 employees. The company was formerly known as Sinexus and changed its name to Intersect ENT Inc. in November 2009.
Separately, Intersect ENT posted a second-quarter loss of 49 cents a share, while analysts polled by FactSet called for a loss of 40 cents.
Revenue totaled $27.3 million, up 180% from a year ago. The FactSet consensus called for revenue of $27.8 million.
The gains was attributed to increased revenue from the company's Propel sinus implants "resulting from a significant recovery in demand from the COVID-19 pandemic on elective surgical procedures."
Medical-equipment companies have suffered from the halt of elective surgeries during the coronavirus pandemic.
Intersect has laid off 25% of its workers and furloughed another 5%.
Last month, Bloomberg reported about Medtronic's interest in acquiring Intersect ENT.