Medtronic and Osteotech have signed a definitive agreement under which Medtronic will acquire Osteotech for $6.50 per share in cash for each share of Osteotech common stock.

The acquisition expands Medtronic’s product offering, pipeline and new markets for biologics business and the total value of the transaction is expected to be approximately $123m.

The acquisition will complement the Medtronic biologics business’ bone healing portfolio and expand its current presence in spine, orthopedic trauma, and dental into several additional new treatment areas including joint reconstruction, foot and ankle, and sports medicine.

Medtronic executive vice president and Restorative Therapies Group president Chris Connell said, “Osteotech’s products and capabilities will better position Medtronic in present competitive musculoskeletal biologics market, and also position the company more broadly for the opportunity we see in the future.”

Osteotech chairman of the board of directors Kenneth Fallon said, “We believe this as the best path forward for the Osteotech organization and products, and we look forward to finalize the transaction smoothly and quickly.”

The transaction is subject to customary closing conditions, including approval by Osteotech’s stockholders and US and foreign regulatory clearances.