Zimmer Holdings to acquire Abbott Spine

Zimmer said it expects to fund the purchase of Abbott Spine with cash on hand and by tapping existing credit lines.

The acquisition is expected to close in the fourth quarter, Zimmer said, adding that the boards of both companies approved the transaction, which is subject to regulatory approvals. Stockholder approval is not required.

Abbott Spine had 2007 revenue of $109 million.

Zimmer expects the transaction to reduce earnings per share by roughly 3 cents in the fourth quarter, between 8 cents and 10 cents in 2009 and neutral to a slight reduction in 2010.

The estimates exclude certain one-time charges.

Zimmer expects to incur $40 million to $50 million in restructuring and integration costs in connection with the transaction.