Physio-Control of Redmond, the region's first big medical device manufacturer and a major employer, is being sold to Bain Capital for $487 million, parent company Medtronic announced.

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Physio-Control of Redmond, the region’s first big medical device manufacturer and a major employer, is being sold to Bain Capital for $487 million, parent company Medtronic announced Thursday morning.

The all-cash deal follows five years of uncertainty for Physio-Control, best known for the Lifepak emergency defibrillators used by ambulance crews and other first responders to treat cardiac arrest. Medtronic originally proposed spinning off Physio as a public company in December 2006, but quality-control problems a few months later torpedoed that plan.

Physio-Control President Brian Webster, who will become CEO under Bain’s ownership, said the sale means Physio “will be definitely adding staff in the short term” in a few areas like finance that were previously handled by Medtronic. The company has 650 workers in Redmond and 400 more worldwide, plus nearly 200 contract employees.

In the longer term, the company hopes some recent forays into new types of emergency-treatment equipment will add momentum to sales that held steady at $425 million in the past two fiscal years.

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“We’ve got nice growth prospects and we’re pretty excited about the future,” said Webster. Physio is profitable, he said, declining to disclose any specifics.

The sale is expected to close in the first quarter of 2012.

Founded in 1955 by University of Washington cardiac surgeon William Edmark, Physio-Control has gone through several cycles as a public company and a subsidiary of bigger corporations.

Indeed, this is not the first time private-equity firm Bain Capital has owned it — it bought Physio in 1994 from Eli Lilly, and took it public the next year. Medtronic has owned it since 1998.

Physio’s recent history was marred by a three-year struggle to overcome quality-control issues flagged by the Food and Drug Administration. It finally won approval to resume full production and sales in 2010.

Early this year Medtronic’s efforts to divest the unit resumed, with the Minneapolis giant’s chief financial officer explaining that Physio’s profit margins are “clearly below the company’s average.”

Webster said the two companies have different markets so their margins aren’t really comparable, and Physio remains the world leader in its category.

“We expect to have strong cash flows and good top-line and bottom-line growth,” he said.

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