Chinese company Shandong Weigao Group Medical Polymer (Shandong Weigao) has entered an agreement to acquire US-based Argon Medical Devices for $850m.

To carry out the acquisition, Shandong Weigao has formed a joint venture (JV) through its wholly owned subsidiary, Weigao International.

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Weigao International holds 90% stake in the JV, while the remaining 10% is held by an undisclosed Cayman Islands-based firm run by a private equity company.

Argon Medical Devices develops, manufactures, sells and distributes medical devices for application in interventional oncology and vascular interventional procedures.

The firm’s portfolio includes biopsy products, vascular clot management devices, drainage catheters and guidewires.

Shandong Weigao expects that the acquisition, which is part of its overseas expansion strategy, will allow increased sales contribution from international markets.

“Shandong Weigao expects that the acquisition, which is part of its overseas expansion strategy, will allow increased sales contribution from international markets.”

The addition of clinically differentiated interventional devices is expected to expand the firm’s current product portfolio, which includes single-use consumables, orthopaedic implants, blood purification dialysis and equipment, as well as dialysis centres.

Argon Medical Devices is also expected to leverage Shandong Weigao’s existing sales and marketing network for business expansion.

According to the agreement, a wholly owned subsidiary of the JV will fund $420m of the total consideration with debt financing, while the JV will provide the balance.

Weigao International plans to fund its pro-rata cash payment to the JV from its internal resources.

Upon completion of the transaction, Argon Medical Devices will be merged as a subsidiary into Shandong Weigao.