Medtronic Launches Exchange Offer for MiniMed Shares

Medtronic plc has initiated an exchange offer aimed at completing the separation of its Diabetes business, now known as MiniMed Group, Inc. The move is part of Medtronic's strategy to focus on its core Cardiovascular, Neuroscience, and Surgical portfolios while allowing MiniMed to operate independently.

According to the press release, Medtronic shareholders can now exchange their ordinary shares for shares of MiniMed at a 7% discount. The exchange offer is expected to be generally tax-free for U.S. federal income tax purposes, providing a benefit for participating shareholders.

Geoff Martha, Medtronic's Chairman and Chief Executive Officer, expressed confidence in MiniMed's future.

The exchange offer will permit Medtronic shareholders to receive approximately $107.53 of MiniMed common stock for every $100 of Medtronic ordinary shares tendered. The prices for the exchange will be determined by the arithmetic average of the daily volume-weighted average prices of Medtronic ordinary shares on the NYSE and MiniMed common stock on the Nasdaq during the three consecutive trading days ending on and including the second trading day preceding the expiration date of the exchange offer. The expiration date is expected to be October 9, 2026, if the exchange offer is not extended or terminated.

Medtronic currently owns approximately 90% of MiniMed, with 252,813,348 shares of MiniMed common stock. The company is offering to exchange up to 225,361,295 shares of MiniMed common stock for outstanding Medtronic ordinary shares. If the exchange offer is oversubscribed, Medtronic intends to exchange an additional 27,452,053 shares, which would cover its remaining interest in MiniMed.

The exchange offer is voluntary for Medtronic shareholders. No action is required for those who choose not to participate. The terms and conditions of the exchange offer are detailed in a registration statement on Form S-4 filed by MiniMed with the U.S. Securities and Exchange Commission (SEC) and a tender offer statement on Schedule TO to be filed by Medtronic with the SEC.

Goldman Sachs & Co. LLC and BofA Securities, Inc. will serve as dealer managers for the exchange offer. The final exchange ratio, reflecting the number of shares of MiniMed common stock that tendering shareholders will receive for each Medtronic ordinary share accepted in the exchange offer, will be announced by press release by 9:00 a.m., New York City time, on the trading day immediately preceding the expiration date of the exchange offer.

The completion of the exchange offer is subject to certain conditions, including the issuance of at least 112,680,647 shares of MiniMed common stock in exchange for outstanding Medtronic ordinary shares validly tendered in the exchange offer and the receipt of an opinion of counsel that the exchange offer will qualify as a generally tax-free transaction for U.S. federal income tax purposes, except with respect to the receipt of cash in lieu of fractional shares.

This move by Medtronic is part of its broader strategy to streamline operations and focus on core business areas. MiniMed, with its strong innovation pipeline and leadership team, is expected to continue its momentum as an independent company.