Medtronic, Inc. (NYSE: MDT) and CryoCath Technologies Inc. (TSX: CYT) today announced they have entered into an agreement whereby Medtronic, through a wholly owned subsidiary, will make a takeover bid for all of the outstanding shares of CryoCath for $8.75 Cdn per share in cash, representing a total equity value of approximately $400 million Cdn ($380 million USD).

The CryoCath board of directors has unanimously recommended that CryoCath shareholders accept the offer, and the acquisition is expected to close in the fourth quarter of calendar 2008.

“Medtronic estimates that up to five million patients worldwide are impacted by atrial fibrillation,” said Pat Mackin, president of the Cardiac Rhythm Disease Management business and senior vice president at Medtronic. “Medtronic and physicians are interested in procedures that are safer, faster and less complex so that more patients can benefit from treatment.”

“Medtronic’s offer reflects its endorsement of our cryoablation technology and the role that our flagship product, Arctic Front®, will play in treating atrial fibrillation patients around the world,” said Jan Keltjens, president and CEO of CryoCath. “This offer delivers significant value. Joining forces with Medtronic at this stage in our development will dramatically expand our reach and accelerate innovation to the benefit of patients today and tomorrow.”  

The offer price represents a 97 percent premium to the closing price of the common shares of CryoCath on September 24, 2008, the last trading day prior to the announcement of the offer and a 93 percent premium to the volume weighted average trading price of the shares for the last 20 trading days.

The agreement was entered into following the completion of due diligence and negotiation during an exclusivity period and provides for, among other things, a non-solicitation covenant on the part of CryoCath, subject to “fiduciary out,” superior proposal and right-to-match provisions and the payment of a $13.6 million Cdn break-up fee in certain circumstances.  

Medtronic’s offer to purchase is subject to the tender of at least 66 2/3 percent of CryoCath’s outstanding common shares on a fully diluted basis. The closing of the transaction is also subject to regulatory clearance and other customary conditions.

A take-over bid circular containing the terms of the offer and additional information regarding the offer, as well as a directors’ circular describing the background to the offer, will be mailed to CryoCath shareholders in the near future. Once mailed, these documents will also be available on the SEDAR website at www.sedar.com. 

Asanté Partners is the financial advisor to the Board of Directors of CryoCath and legal counsel to CryoCath is Davies Ward Phillips & Vineberg LLP. Medtronic is being represented by Stikeman Elliott LLP. 

About CryoCath

CryoCath - www.cryocath.com - is a medical technology company that leads the world in cryotherapy products to treat cardiac arrhythmias. With annual sales in excess of $40 million Cdn, its products are routinely used in more than 500 centers around the world. The Company’s flagship product, Arctic Front, is a minimally invasive cryo-balloon catheter designed specifically to treat Atrial Fibrillation, an emerging $2 billion market opportunity. Marketed in Europe and the subject of a pivotal study in the United States, Arctic Front has been used to treat approximately 3,100 patients.

About Medtronic

Medtronic, Inc. (www.medtronic.com), headquartered in Minneapolis, is the global leader in medical technology – alleviating pain, restoring health, and extending life for millions of people around the world.