St. Jude Medical Inc. said Monday it would buy heart device maker AGA Medical Holdings Inc. for a combined cash and stock offer totaling more than $1 billion.

St. Paul-based St. Jude said it would pay $20.80 a share for AGAM, a 41 percent premium on the company's Friday closing price. The deal, estimated at around $1.3 billion, also includes the assumption of AGAM's nearly $225 million in outstanding debt. St. Jude expects to close the deal by year's end.

The news comes as AGAM, which makes vascular plugs and an atrial septal defect closure device, nears its first birthday as a publicly traded company.

With the buy of Plymouth, Minn.-based AGAM, St. Jude hopes to broaden its portfolio beyond its traditional line of pacemakers and implantable defibrillators, analysts said.

"With its extensive structural heart disease portfolio, AGAM will propel STJ in a more significant way into one of the fastest growing areas of med tech-- minimally invasive structural heart applications," Rick Wise, an analyst with Leerink Swann, said in an e-mail to investors.

St. Jude's stock climbed 1.8 percent at the news, closing at $40.63 on Monday. AGAM soared around 40 percent, to close at $20.70.