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Medtronic to buy stake in Chinese firm
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Medtronic Inc., the largest maker of medical products for the spine, expanded its presence in China by agreeing to buy a minority stake in that country's biggest device manufacturer.
Medtronic plans to buy 15 percent of the shares of Shandong Weigao Group Medical Polymer Co. for $221 million and take a 51 percent interest in a joint venture to market products for the spine and orthopedics in the world's most populous nation, a statement said.
Fridley-based Medtronic estimates that 100 million people in China have orthopedic ailments and that millions more have other conditions its devices are designed to treat. Medtronic has eight operating units, 800 employees and 13 offices in China, Hong Kong and Taiwan.
The company runs an education center that trained 4,000 doctors in use of its products last year, said Jean-Luc Butel, president of Medtronic's Asia-Pacific division.
"We needed to find a local partner to help us get a better foothold in an area dominated by Chinese companies," he said.
Weigao, based in the northern Chinese city of Weihai, produces orthopedic devices, heart stents, blood purification products and single-use items such as syringes.
"There's huge potential in China," Gary Ellis, Medtronic's chief financial officer, said in a telephone interview. "Many of our products would clearly benefit the Chinese market."
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