MADRID – Global medical technology group Smith & Nephew PLC said Monday it will buy medical-device maker ArthroCare Corp. for $1.7 billion in cash. Under terms of the deal, Smith & Nephew will pay $48.25 per ArthroCare share in cash, with an enterprise value of $1.5 billion. Shares of ArthroCare closed at $45.38 on Friday. Smith & Nephew said the acquisition will add around $85 million to annual trading profit in the third full year, but that one-off transaction and integration costs will be around $100 million over a three-year period. Smith & Nephew will finance the deal from its debt facilities and cash balances, which includes an existing $1 billion revolving credit facility and a new two-year $1.4 billion loan facility. Shares of Smith & Nephew rose 1.4% in London.
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