UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14D-9
(Rule 14d-101)
SOLICITATION/RECOMMENDATION STATEMENT UNDER
SECTION 14(d)(4) OF THE SECURITIES EXCHANGE ACT OF 1934
ev3 Inc.
(Name of Subject Company)
ev3 Inc.
(Names of Person(s) Filing Statement)
Common Stock, par value $0.01 per share
(Title of Class of Securities)
26928A200
(CUSIP Number of Class of Securities)
Kevin M. Klemz
Senior Vice President, Secretary and Chief Legal Officer
ev3 Inc.
3033 Campus Drive
Plymouth, Minnesota 55441
(763) 398-7000
(Name, Address and Telephone Number of Person Authorized to Receive
Notice and Communications on Behalf of the Person(s) Filing Statement)
Copies To:
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Bruce A. Machmeier, Esq.
Amy E. Culbert, Esq.
Patrick J. Pazderka, Esq.
Oppenheimer Wolff & Donnelly LLP
45 South Seventh Street, Suite 3300
Minneapolis, Minnesota 55402-1509
(612) 607-7000
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Steven J. Gartner, Esq.
Adam M. Turteltaub, Esq.
Willkie Farr & Gallagher LLP
787 Seventh Street
New York, New York 10019
(212) 728-8000
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Check the box if the filing relates solely to preliminary communications made before
the commencement of a tender offer.
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EMAIL COMMUNICATION FROM BOB PALMISANO TO ALL EV3 EMPLOYEES
June 1, 2010
Dear ev3 Team Member,
Today ev3 announced an agreement to be acquired by Covidien, a large global healthcare products
company for $2.6 billion, net of cash acquired. Both our board of directors and I unanimously
believe the opportunities this combination presents for our company, customers and employees are
tremendous and the value created immediately for our shareholders is substantial. Attached to this
email you will find a copy of the press release we issued today and a Frequently Asked Questions
document, which we hope will answer some of the questions you may have.
Covidien will hold a conference call for investors today, beginning at 7:00 a.m. Central Time.
This call can be accessed three ways:
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At Covidien’s website: http://investor.covidien.com
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By telephone: The number in the U.S. is 800-299-7098. For participants outside the
U.S., the dial-in number is 617-801-9715. The access code for all callers is 56418613.
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Through an audio replay: A replay of the conference call will be available beginning
at 9:00 a.m. on June 2, 2010, and ending at 5:00 p.m. on June 8, 2010. The dial-in
number for U.S. participants is 888-286-8010. For participants outside the U.S., the
replay dial-in number is 617-801-6888. The replay access code for all callers is
46835409.
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Now I would like to share some insights into this historic development for our company.
Who is Covidien and why are they acquiring ev3?
Covidien is a leading global healthcare products company that creates innovative medical solutions
for better patient outcomes and delivers value through clinical leadership and excellence. ev3’s
products complement Covidien’s existing vascular therapy products including dialysis catheters,
vascular access products, compression products; the Trellis
®
Peripheral Infusion System
(gained in the Bacchus Vascular acquisition in 2009) and ClosureFAST™ (gained from the VNUS
acquisition in 2009). The combination of these acquisitions and ev3’s broad platform of peripheral
vascular and neurovascular technologies with Covidien’s current product line puts the combined
companies in a leadership position in the prevention and treatment of vascular disease.
In addition, the combined companies will have a larger U.S. and worldwide sales and distribution
footprint, with some of the most technologically advanced product offerings. With 2009 revenue of
more than $10 billion, Covidien has more than 42,000 employees worldwide in 60 countries, and its
products are sold in over 140 countries.
I have no doubt that your hard work and unwavering commitment to our vision to be the best garnered
their admiration and interest in us as a company. Together, by merging our complementary strengths
and collective resources into one organization, we will now be able to advance our broad platform
of peripheral vascular and neurovascular technologies with a leading global healthcare products
company that shares our vision of delivering breakthrough and innovative medical solutions for
improved patient outcomes. In addition, this combination provides the opportunity for further
innovation to support endovascular market growth and procedure penetration worldwide, while our
employees are afforded the opportunity to be part of a larger organization with greater depth of
resources for sustained success in our industry.
What’s next?
At this point in the process, we will now work on obtaining the required regulatory and shareholder
approvals necessary to close this merger, which we are targeting to occur by July 31, 2010. Until
the closing, ev3 and Covidien will remain separate companies. I know I can count on you to focus
on our objectives, continue serving our customers with the same passion and commitment that they
have come to expect from ev3. We will make every effort to keep you informed throughout this
process with periodic updates.
ev3 all-employee conference call and employee meetings today
I will be hosting an all-employee conference call this morning at 9:00 a.m. Central Time (7:00 a.m.
Pacific Time; 4:00 p.m. Paris Time) just for our company employees, to provide additional
information about this combination and what it means for you. To participate in the call, please
dial 800-706-7741 (U.S.) or 617-614-3471 (International) and let the operator know that you are
dialing in for the “ev3 Employee Conference Call” ID# 30567960.
There will be a replay of the all-employee conference call available beginning Tuesday, June 1,
2010 from 11:00 a.m. Central Time (9:00 a.m. Pacific Time; 6:00 p.m. Paris Time) until Friday, June
4, 2010 at 5:00 p.m. Central Time. To access the replay recording for the conference call, please
dial 888-286-8010 (U.S.) or 617-801-6888 (International) and provide ID#57480075.
After the all-employee conference call, we will also be hosting meetings for employees in Plymouth,
Irvine and Paris. There will also be conference calls scheduled for our US Peripheral Vascular, US
Neurovascular and International Sales Teams. You will be receiving more information about the
employee meetings and sales conference calls by email.
Please note that over the coming weeks, you may be contacted by members of the media, investors or
the general public regarding this transaction. It is very important that you forward any calls you
may receive to Julie Tracy, our Chief Communications Officer, at 949-680-1375 or jtracy@ev3.net.
In closing
I am very proud of the progress that ev3 has made since our founding in 2000, and I sincerely thank
each of you for your hard work and dedication. You should also be very proud of the fact that the
good work we do every day enhances the lives of thousands of people around the world. I am
confident that with Covidien, we can accelerate our ability to positively impact physicians,
patients and our employees who have made this possible.
Best regards,
Bob Palmisano
President and Chief Executive Officer
IMPORTANT INFORMATION ABOUT THE TENDER OFFER
This communication is neither an offer to purchase nor a solicitation of an offer to sell any
securities of ev3 Inc. COV Delaware Corporation (“Purchaser”), an indirect, wholly owned
subsidiary of Covidien, has not yet commenced the tender offer for shares of ev3 common stock.
Upon commencement of the tender offer, Purchaser will file with the Securities and Exchange
Commission (“SEC”) a tender offer statement on Schedule TO and related exhibits, including the
offer to purchase, letter of transmittal, and other related documents. Following commencement of
the tender offer, ev3 will file with the SEC a tender offer solicitation/recommendation statement
on Schedule 14D-9. These documents will contain important information about Covidien, ev3, the
transaction and other related matters. Investors and security holders are urged to read each of
these documents carefully when they are available.
Investors and security holders will be able to obtain free copies of the tender offer statement,
the tender offer solicitation/recommendation statement and other documents filed with the SEC by
Purchaser and ev3 through the web site maintained by the SEC at www.sec.gov. In addition, investors
and security holders will be able to obtain free copies of these documents by contacting:
Covidien
Investor Relations
508-452-4650
investor.relations@covidien.com
or
ev3 Inc.
Julie Tracy
Sr. Vice President
Chief Communications Officer
949-680-1375
jtracy@ev3.net
Frequently Asked Questions
ev3 Inc. Employee Document
For Distribution June 1, 2010
General
Q. Why is Covidien acquiring ev3 Inc?
A.
Covidien is a leading global healthcare products company that creates innovative medical
solutions for better patient outcomes and delivers value through clinical leadership and
excellence. ev3’s products complement Covidien’s existing vascular therapy products including
dialysis catheters, vascular access products, compression products; the Trellis
®
Peripheral Infusion System (gained in the Bacchus Vascular acquisition in 2009) and ClosureFAST™
(gained from the VNUS acquisition in 2009). The combination of these acquisitions and ev3’s broad
platform of peripheral vascular and neurovascular technologies with Covidien’s current product line
puts the combined companies in a leadership position in the prevention and treatment of vascular
disease.
Furthermore, the combined companies will have a larger U.S. and worldwide sales and distribution
footprint, with some of the most technologically advanced product offerings. With 2009 revenue of
more than $10 billion, Covidien has more than 42,000 employees worldwide in 60 countries, and its
products are sold in over 140 countries.
Q. What are the terms of the agreement?
A.
The Boards of Directors of both companies have unanimously approved the transaction whereby
Covidien will pay $22.50 in cash per ev3 share for a total of approximately $2.6 billion, net of
cash acquired. The transaction, which will take the form of an all cash tender offer followed by a
second-step merger, is subject to customary closing conditions, including receipt of certain
regulatory approvals, and is expected to be completed by July 31, 2010
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Q. Why is ev3 Inc. selling at this time?
A
. We believe that Covidien’s offer represents compelling value for ev3 Inc. stockholders and that
the completed transaction will result in important benefits supporting long-term growth and
significant value for our customers—peripheral vascular and neurovascular surgeons, interventional
cardiologists, interventional radiologists and neuroradiologists—and their patients.
Q. Will there be any reduction-in-force as a result of the transaction?
A.
In the short term while we complete the closing of the transaction, we do not expect any job
responsibilities to change. During this time, an integration team will be working to identify how
to best leverage each company’s strengths and bring our companies together.
There may be some consolidation as a result of combining companies; however, Covidien is acquiring
ev3 because ev3 built a business based on technological advances and excellent execution. Covidien
wants to leverage that success and the exceptional talent of both organizations. In order to
maximize the success of the acquisition, it is essential that the companies take advantage of the
combined economies of scale.
Q. Will ev3 Inc. stay in its current location? Will employees from Covidien move to ev3?
A.
It is expected that ev3 will remain in its current location. Covidien may consider moving
employees from other sites into ev3 as part of the integration plan.
ev3 FAQ
June 1, 2010
Q. How will ev3 notify our customers, suppliers and distributors?
A.
ev3 will be sending a letter to customers, distributors and suppliers to notify them about the
transaction.
ev3 Inc. U.S. and International Sales
Q. Should ev3 field sales employees continue to sell to ev3 customers?
A.
Yes, all ev3 Sales and Field Sales Specialists should continue business as usual. It is
anticipated that existing relationships will be strengthened as a result of this transaction. ev3
will work closely with its customers to help ensure that our customers understand the real benefits
of this transaction and why ev3 should be an even better strategic partner after the transaction is
completed.
Q. How will this transaction affect ev3 relationship with its customers?
A.
This transaction should help ev3 to better meet the needs of its customers and help customers
to have even more choices in the treatment of their patients. Covidien’s strategy is to offer
broad and technologically advanced product lines to treat vascular disease.
ev3 is, and must remain, an independent operating company through completion of the transaction.
Q. Will ev3 customers be transferred to Covidien? Will the ev3 sales force be able to keep all of
its existing accounts?
A.
Customers will be transferred to Covidien upon close of the transaction. At this time, it is
not anticipated that changes to the sales teams will be made other than building up staff where it
benefits customers and the combined company.
Q. Will the territories or regions change at ev3?
A.
In the short term while we complete the closing of the transaction, we do not expect any job
responsibilities to change. During this time, an integration team will be working to identify how
to best leverage each company’s strengths and bring our companies together. It is possible that
there may be some additional territory or region realignment after the transaction closes.
However, Covidien has been consistent in their message that hiring should continue for all open
sales positions and that they are looking to expand the U.S. sales presence.
Customer Service Specialists
Q. Should the telephone be answered differently? Starting when?
A.
Since the businesses will be operated as independent companies until the closing of the
second-step merger, there is no need to change the way you answer the phone. After the close of
the merger, if a change is required, you will be advised of any change.
Q. What should ev3 Customer Service tell callers who ask about the transaction?
A
. Covidien has entered into a definitive agreement to acquire ev3. Press releases have been
issued regarding the transaction. How may I direct your call?
If a member of the news media, refer call to:
Bruce Farmer
Vice President, Public Relations
ev3 FAQ
June 1, 2010
Covidien
(508) 452-4372
Julie Tracy
Sr. Vice President, Chief Communications Officer
ev3 Inc.
949-680-1375
jtracy@ev3.net
If a customer or vendor, refer call as usual
Benefits Questions
Q. What will happen to the ev3 base pay, bonus and benefits (including health and welfare, paid
time off, retirement, etc)?
A
. Both companies are committed to providing a competitive compensation and benefits package that
will allow them to continue to attract and retain great talent. This has been a keystone of
success at both organizations. Covidien recognizes the value that ev3 employees bring. A
comprehensive Total Rewards analysis will be conducted and as the closing of the transaction
approaches, more information will be communicated to ev3 employees as to the integration and
transition of benefit plans and offerings.
Q. Will employment with ev3 be recognized by Covidien?
A
. Yes, eligible service with ev3 including prior service with predecessor employers where such
prior service is recognized by ev3, will be recognized for vacation and other benefit plans and
programs, generally, by Covidien.
Q. Does Covidien offer training and professional development opportunities?
A.
Covidien offers robust and comprehensive training and professional development programs. After
the transaction is completed, ev3 employees will be eligible to access the Covidien online tool,
which provides training and development opportunities that are competency-based and supports many
different development topics.
Q. Are there other possible career opportunities for ev3 employees at Covidien?
A.
Covidien is an industry leader. Although Covidien’s U.S. headquarters are located in
Mansfield, MA, there are nearly 42,000 employees worldwide—which means that there are many great
opportunities for career advancement around the globe.
Q. Where can ev3 employees obtain additional information?
A.
ev3 employees should contact their manager or the leader of their department with questions.
Alternatively, ev3 employees can email questions relating to this transaction to Greg Morrison at
gmorrison@ev3.net
. Best efforts will be made to answer questions in a timely and informative
manner.
IMPORTANT INFORMATION ABOUT THE TENDER OFFER
This communication is neither an offer to purchase nor a solicitation of an offer to sell any
securities of ev3 Inc. COV Delaware Corporation (”Purchaser”), an indirect, wholly owned
subsidiary of Covidien, has not yet commenced the tender offer for shares of ev3 common stock.
ev3 FAQ
June 1, 2010
Upon commencement of the tender offer, Purchaser will file with the Securities and Exchange
Commission (“SEC”) a tender offer statement on Schedule TO and related exhibits, including the
offer to purchase, letter of transmittal, and other related documents. Following commencement of
the tender offer, ev3 will file with the SEC a tender offer solicitation/recommendation statement
on Schedule 14D-9. These documents will contain important information about Covidien, ev3, the
transaction and other related matters. Investors and security holders are urged to read each of
these documents carefully when they are available.
Investors and security holders will be able to obtain free copies of the tender offer statement,
the tender offer solicitation/recommendation statement and other documents filed with the SEC by
Purchaser and ev3 through the web site maintained by the SEC at www.sec.gov. In addition, investors
and security holders will be able to obtain free copies of these documents by contacting:
Covidien
Investor Relations
508-452-4650
investor.relations@covidien.com
or
ev3 Inc.
Julie Tracy
Sr. Vice President
Chief Communications Officer
949-680-1375
jtracy@ev3.net
ev3 FAQ
June 1, 2010
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ev3 and Covidien Proposed Acquisition
June 1, 2010
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Agenda
Today's Announcement
Transaction Overview
Who is Covidien?
ev3 and Covidien Together
What's Next? What Does This Mean for ev3
Employees?
Conclusion
Q&A
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Forward-Looking Statements
This presentation contains forward-looking statements that are not historical facts. Covidien and ev3 have identified
some of these forward-looking statements with words like "believe," "may," "could," "would," "might," "possible," "will,"
"should," "expect," "intend," "plan," "anticipate," or "continue", the negative of these words, other terms of similar
meaning or the use of future dates. Forward-looking statements in this presentation include without limitation
statements regarding the expected timing of the completion of the transaction and statements regarding the effect of
the transaction on Covidien's business and its future financial performance and financial condition. Investors and
security holders are cautioned not to place undue reliance on these forward-looking statements. Actual results could
differ materially from those currently anticipated due to a number of risks and uncertainties. Risks and uncertainties
that could cause results to differ from expectations include: uncertainties as to the timing of the transaction;
uncertainties as to how many of ev3's stockholders will tender their shares in the offer; the risk that competing offers
will be made; the possibility that various closing conditions for the transaction may not be satisfied or waived, including
that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the transaction; the
effects of disruption from the transaction making it more difficult to maintain relationships with employees, customers,
vendors and other business partners; the risk that stockholder litigation in connection with the transaction may result in
significant costs of defense, indemnification and liability; other business effects, including the effects of industry,
economic or political conditions outside of Covidien's and ev3's control; transaction costs; actual or contingent
liabilities; and other risks and uncertainties discussed in Covidien's and ev3's filings with the U.S. Securities and
Exchange Commission, including the "Risk Factors" sections of Covidien's and ev3's most recent annual report on
Form 10-K and subsequent quarterly reports on Form 10-Q, as well as the tender offer documents to be filed by
Covidien and the Solicitation/Recommendation Statement to be filed by ev3. Neither Covidien nor ev3 undertakes any
obligation to update any forward-looking statements as a result of new information, future developments or otherwise,
except as expressly required by law. All forward-looking statements in this presentation are qualified in their entirety
by this cautionary statement.
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Important Information About the Tender Offer
This presentation is neither an offer to purchase nor a solicitation of an offer to sell any securities of
ev3 Inc. COV Delaware Corporation ("Purchaser"), an indirect, wholly owned subsidiary of Covidien,
has not yet commenced the tender offer for the shares of ev3 common stock.
Upon commencement of the tender offer, Purchaser will file with the SEC a tender offer statement on
Schedule TO and related exhibits, including the offer to purchase, letter of transmittal, and other
related documents. Following commencement of the tender offer, ev3 will file with the SEC a tender
offer solicitation/recommendation statement on Schedule 14D-9. These documents will contain
important information about Covidien, ev3, the transaction and other related matters. Investors and
security holders are urged to read each of these documents carefully when they are available.
Investors and security holders will be able to obtain free copies of the tender offer statement, the
tender offer solicitation/recommendation statement and other documents filed with the SEC by
Purchaser and ev3 through the web site maintained by the SEC at www.sec.gov. In addition,
investors and security holders will be able to obtain free copies of these documents by contacting
Covidien Investor Relations at 508-452-4650 or investor.relations@covidien.com or ev3 Inc., Julie
Tracy, Sr. Vice President , Chief Communications Officer at 949-680-1375 or jtracy@ev3.net.
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Today's Announcement
Covidien intends to purchase all common shares of ev3 through a
cash tender offer
Once the transaction has been completed, Covidien will report ev3
as part of its Vascular Products line in the Medical Devices
business segment.
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Transaction Overview
Anticipated Close
Consideration
Customary Approvals
By July 31, 2010, subject to closing conditions, including receipt
of certain regulatory approvals
$22.50 per share in cash
TV/LTM revenue: 5.43x
19% premium over closing price of ev3's common stock on May
28, 2010 (last trading day prior to announcement)
Tender of shares by ev3 shareholders, clearance by U.S. and
certain non-U.S. antitrust regulators and other customary
conditions
~$2.6 billion, net of cash acquired
Delivering Significant and Immediate Value to ev3 Shareholders
Transaction Value
Premium to Sales
Multiple and Stock
Price
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Covidien at a Glance
Covidien is:
A leading manufacturer of medical devices and supplies,
diagnostic imaging agents and pharmaceuticals, with 2009
revenue of $10.7 billion and industry-leading profit margins
42,000 employees worldwide in more than 60 countries, with
products sold in over 140 countries
Committed to creating innovative medical solutions for better
patient outcomes and delivering value through clinical
leadership and excellence
To learn more, please visit www.covidien.com
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Why ev3?
"The acquisition of ev3 enables Covidien to significantly expand its
presence in the vascular market and is in line with our strategy of
becoming a leading partner with vascular surgeons, neurosurgeons,
interventional cardiologists and interventional radiologists. With
its broad product portfolio, clinical expertise and call-point synergies
with our existing vascular franchise, ev3 is an important addition to
our innovative vascular intervention products."
Richard J. Meelia
Chairman, President and CEO of Covidien
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Why ev3? Key benefits for Covidien
ev3 will be a significant addition to Covidien's vascular therapy
business
Expands Covidien's existing platform in peripheral vascular market
Establishes immediate leadership position for Covidien in high-
growth neurovascular market
Leverages combined organization's world-class sales forces and
expertise in developing and marketing innovative products
Provides opportunity for further innovation to support endovascular
market growth and procedure penetration worldwide
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Why Covidien? Key Benefits for ev3
Advances our broad platform of peripheral vascular and
neurovascular technologies with leading global healthcare
products company
Leverages ev3's world-class sales organization to better serve
patients and clinicians
Leverages both organizations' expertise in developing and
marketing innovative products
Together, committed to creating innovative medical solutions for
better patient outcomes and delivering value through clinical
leadership and excellence
Combination meaningfully increases ability to ensure we meet needs
of clinician customers around the world and patients they serve
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What's Next? What Does this Mean for ev3
Employees?
ev3 will continue to operate normally..."business as usual"
Thoughtful integration planning to foster growth and success
Covidien intends to utilize the "ev3" name and brands
No changes in benefits and compensation are under consideration
at this time
ev3 and Covidien expect the transaction to close by July 31, 2010
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Roadmap To Completion
Event
Expected Timeline
Execute definitive agreement
Solicit tender of shares from ev3
shareholders
Receive regulatory clearances
Close transaction
Completed
Tender offer documents to be
filed by mid-June - offer period
to remain open for at least 20
business days
By July 31, 2010
By July 31, 2010
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Our Commitment to You
Ongoing, frequent & timely updates to provide additional
information
Regular management contact
In-person meetings to keep employees informed
Written communication as information becomes available
Maintain open and transparent communication
Fully dedicated management team to answer your questions
Additional resources for employees
Press release, Employee FAQs
Submit questions through ev3 Portal
HR representative
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Conclusion
Offers immediate return on investment for shareholders
Advances our broad platform of peripheral vascular and
neurovascular technologies with leading global healthcare
products company
Leverages combined organization's world-class sales forces and
expertise in developing and marketing innovative products
Provides opportunity for further innovation to support
endovascular market growth and procedure penetration
worldwide
Anticipated to close by July 31, 2010, subject to customary
closing conditions, including receipt of certain regulatory
approvals
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