Under the agreement, AtriCure has agreed to acquire Estech for a cash-free, debt-free up-front payment of approximately 2.1 million shares or $34m of AtriCure common stock and up to $26m in additional consideration based on the achievement of certain revenue-based milestones.

The transaction is subject to customary closing conditions and is expected to close in the next several weeks. AtriCure shareholder approval is not required.

Estech develops and markets a portfolio of innovative surgical ablation devices that enable physicians to perform a variety of traditional and minimally invasive procedures using Estech’s proprietary temperature controlled RF energy.

AtriCure president and CEO Mike Carrel noted Estech is an ideal strategic fit for AtriCure, as it expands our presence and reinforces the company’s commitment to the atrial fibrillation market.

"The combination of the two companies enhances AtriCure’s leadership and intellectual property position across surgical ablation and epicardial left atrial appendage (LAA) closure and accelerates the availability of broader surgical ablation offerings through the combination of Estech’s sales and marketing and R&D capabilities worldwide under the AtriCure umbrella.

"This acquisition demonstrates our commitment to providing the most robust suite of products and solutions for our physician customers to treat the broadest set of patients suffering from Afib and Afib-related complications.

"Afib remains a large and growing market. Our ongoing investments in R&D, physician education and training, clinical science and commercial execution are major steps to capitalize on this market opportunity," Carrel added.

AtriCure expects that the transaction will increase sales and marketing expense as well as research and development expenditures in order to accelerate clinical development and commercial sales of the combined product portfolio.

While these expenses will increase on absolute dollar basis, AtriCure expects these expenses to decrease as a percentage of sales beginning in 2015. AtriCure expects the transaction to be dilutive to earnings in 2014 and accretive in 2015 and beyond.