Medtronic to Acquire Ablation Frontiers

Medtronic’s AF Solutions Franchise Will Include Radiofrequency Catheter Ablation Technologies for the Treatment of Atrial Fibrillation

Medtronic, Inc. (NYSE: MDT) and privately held Ablation Frontiers, Inc., today announced that the two companies have entered into an agreement whereby Medtronic will acquire Ablation Frontiers for an initial payment of $225 million plus potential additional payments contingent upon achievement of certain clinical milestones. The acquisition has been approved by Ablation Frontiers shareholders, and is subject to regulatory clearance. The transaction is expected to close in Medtronic’s fourth fiscal quarter, ending April 24, 2009.

“As the leader in cardiac rhythm disease management, Medtronic is well positioned to deliver innovative therapies and expand the marketplace to address unmet needs in atrial fibrillation,” said Pat Mackin, president of the Cardiac Rhythm Disease Management business and senior vice president at Medtronic. “Once the transaction is complete, we will add Ablation Frontiers’ emerging technologies to our growing AF Solutions franchise.”

The goal of Medtronic’s newly formed AF Solutions franchise, led by vice president and general manager Reggie Groves, is to be the physician partner of choice for atrial fibrillation (AF) ablation by bringing breakthrough AF therapies to the patients and physicians that are simpler, safer, effective, and offer more predictable procedure times than current treatment methods. Medtronic will offer physicians a choice of ablation therapies and tools to best meet the needs of their AF patients, as well as the needs of their practices.

Following Medtronic’s recent acquisition of CryoCath Technologies, Inc., a leader in cryoablation treatments for AF, the addition of Ablation Frontiers’ anatomically designed, catheter-based ablation technologies and its unique radiofrequency (RF) energy system will allow Medtronic to deliver the industry’s broadest range of therapies.

Keegan Harper, chief executive officer of Ablation Frontiers, said, “We are thrilled to join Medtronic and together will address the increasingly significant area of atrial fibrillation. We believe there is great value in aligning with a company that will offer a suite of distinct products that will provide physicians and their patients the best solutions for treating atrial fibrillation.”

In 2006, Ablation Frontiers received CE Mark to begin marketing its system of catheters and the RF generator in the European Union. Ablation Frontiers is conducting a clinical trial under a United States Food and Drug Administration (FDA) investigational device exemption (IDE) to gain approval for permanent, or chronic, AF in the U.S.