Medtronic, the medical device behemoth, announced in late June that it would acquire rival Covidien for nearly $43 billion and move its headquarters to Ireland.

"This acquisition will allow Medtronic to reach more patients, in more ways and in more places," said Omar Ishrak, chairman and CEO of Medtronic, in a press statement announcing the deal.

Covidien, which broke off from Tyco Healthcare in 2007, keeps U.S. headquarters in Mansfield, Mass., where it employs some 1,800 workers, but is incorporated in Dublin – enjoying a corporate tax rate of 16 percent. The firm has some 38,000 workers worldwide.

Medtronic, which was founded in Minneapolis in 1949 and employs 46,000 globally, has already whittled its effective tax rate down to 18 percent, significantly lower than the statutory 35 percent corporate rate in the U.S. By setting up shop in Dublin – making it the "biggest company yet to escape the U.S. tax system by shifting its incorporation abroad," according to Bloomberg – it will notch that rate down a few more points.

But in an interview with Reuters, Ishrak insisted that the true impetus for the acquisition was to enable more capital to be devoted to technology innovation – to the tune of $10 billion over the next 10 years.

"The real purpose of this, in the end, is strategic, both in the intermediate term and the long term," he said. "It is good for the U.S. in that we will make more investment in U.S. technologies, which previously we could not."

Medtronic develops smartpumps, cardiac monitors, glucose meters and dozens of other devices. Covidien, which specializes in surgical products, makes a range of patient monitoring platforms and navigation systems.

The merger of the two giants would create a company with combined annual revenue of $27 billion, rivaling the top medical device maker, Johnson & Johnson.

"The medical technology industry is critical to the U.S. economy, and we will continue to invest and innovate and create well-paying jobs," said Ishrak, in a statement. "Medtronic has consistently been the leading innovator and investor in U.S. medtech, and this combination will allow us to accelerate those investments."

"Covidien and Medtronic, when combined, will provide patients, physicians and hospitals with a compelling portfolio of offerings that will help improve care and surgical performance," said José E. Almeida, chairman, president and CEO of Covidien, in a statement.

Whether the tax savings realized by moving across the pond will indeed translate into promised investments and innovations remains to be seen. Some see it as a hedge against a regulatory kibosh. As analysts Jeffrey Goldfarb and Robert Cyran write on The New York Times' DealBook website, "the marriage of Medtronic and Covidien looks to be one of convenience," but "there is reason to suspect a rush to the altar."

They point out that word of a potential Pfizer-AstraZeneca mega merger has focused Washington's attention on tax arbitrage, and that "Congress is now kicking around proposals to restrain so-called inversions, where a buyer finds a target overseas to reduce what it owes Uncle Sam annually. Medtronic's pledge to invest an extra $10 billion in technology over the next decade as part of the deal suggests some political concern."

Another issue, they add, is that while both companies make medical supplies, "they do not necessarily complement each other" – indeed, one is far more technologically advanced than the other.

"Medtronic manufactures high-tech devices implanted in people while its target makes basic surgical materials," write Goldfarb and Cyran. "These require different mind-sets with regard to research, development and regulation."