Medtronic shareholders poised to back Covidien deal

Medtronic shareholders on Tuesday are expected to approve the company's proposed $43 billion acquisition of Irish medical device maker Covidien.

The vote will come a few hours after a similar meeting of Covidien investors in Ireland. Both groups are expected to back the deal, although some Medtronic investors are unhappy because they'll face big capital gains taxes.

Unveiled in June, the merger became controversial after Medtronic said it would use cash kept overseas to buy Covidien and then, on paper, headquarter the firm in Ireland, a country known for its low corporate taxes. The financing structure, known as a tax inversion, would have saved the company billions in U.S. taxes.

Critics, however, including U.S. Treasury Secretary Jacob Lew, weighed in, blasting tax inversions as unpatriotic tax dodges . Medtronic later shifted course and said it would borrow $16 billion to finance the deal instead of using overseas cash.

While it will be an Irish company for tax purposes, it promises to boost investment in the U.S. The combined firm's operational headquarters and CEO will remain in Minnesota. The company says it will add 1,000 jobs to the 8,000 already here.

Medtronic says it has received all necessary antitrust clearances from countries in which does business. Following a review by the High Court of Ireland, the transaction is expected to close early this year.

"We do expect that the acquisition will pass," said Jeff Windau, a stock analyst with the investment firm Edward Jones.

"A large percentage of the ownership is institutional investors. The institutional investors feel the combination will offer some good strategic advantages," he said. "Scale is one of those. The geographic footprint is also a big advantage."