By Brittney Laryea

Medtronic PLC said Monday that it agreed to acquire HeartWare International Inc. for $1.1 billion, giving the medical-device supplier more products that treat heart failure.

Medtronic will pay $58 a share in cash for HeartWare, a 93% premium over HeartWare's Friday closing price of $29.98. Before Monday, HeartWare's stock had fallen 60% over the past year amid declining sales, problems with product studies and an acquisition -- later terminated -- that was seen as dilutive to HeartWare.

The companies said Monday that the acquisition gives Medtronic more diagnostic tools and treatments for heart failure, a condition where the heart isn't pumping enough blood to meet the body's needs.

HeartWare makes surgical implants that mimic the heart's blood-pumping function, known as ventricular assist devices. Medtronic estimated Monday that the global VAD market is about $800 million now and is expected to grow by a percentage in the mid-to-high single digits in the current year and accelerate to a percentage in the high-single, low-double digits in future years.

The companies said they expect the deal to close during Medtronic's second fiscal quarter, ending in late October.

Medtronic said it didn't expect to adjust its fiscal 2017 revenue outlook or earnings because of the acquisition, and that it expected the deal to add to earnings in its third year.

In January 2015, Medtronic closed a $50 billion acquisition of Dublin-based Covidien that combined two of the world's largest medical-supply companies. That deal allowed Medtronic to move its corporate headquarters from Minneapolis to Dublin in a so-called inversion deal that reduced the company's tax burden.

Medtronic, for its fiscal year ended April 29, reported earnings of $3.54 billion on revenue of $28.83 billion. HeartWare, in its most recent fiscal year ended Dec. 31, had a loss of $72.8 million on revenue of $276.8 million.

Shares of Medtronic slipped 1.4% to $82.10 in afternoon trading in New York, while HeartWare shares rose 92% to $57.69.

Last year, Medtronic rival St. Jude Medical Inc. agreed to pay $3.4 billion to acquire Thoratec Corp., another maker of VADs.

Write to Brittney Laryea at brittnÏey.laryea@wsj.com

(END) Dow Jones Newswires

June 27, 2016 14:30 ET (18:30 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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