The purchase price is $860 million, a Covidien statement said.
"The transaction provides Covidien additional scales and scope to serve the multibillion-dollar global gastrointestinal market and supports the company's strategy to comprehensively address key global specialties and procedures," Covidien said in the statement Sunday.
Given Imaging, based in Yoqneam, developed the PillCam, described as a minimally invasive swallowed optical device for the small bowel, esophagus and colon.
Homi Shamir, president and chief executive officer of the Israeli firm, said, "After thoroughly evaluating our strategic options, we determined this transaction is in the best interests of Given Imaging, its shareholders and employees and provides unique benefits to patients globally."
Bryan Hanson of Covidien said the Given Imaging purchase "confirms our leadership in developing less invasive screening, diagnosis and treatment solutions that can improve patient outcomes and lower healthcare costs."