Medtronic Inc., the world's No. 1 manufacturer of pacemakers, plans to buy Physio-Control International Inc., the world's largest maker of external defibrillators, for $538 million in stock and assumed debt. External defibrillators give a shock to patients whose hearts have stopped, or are in danger of doing so, to restore normal rhythm. Medtronic's planned entry into the growing external-defibrillator market comes as the company fights to move ahead of Guidant Corp. in the implantable-defibrillator market. Physio-Control shareholders would receive a fractional share of Medtronic valued at $27.50 for each of their shares, a 20% premium over Physio-Control's closing price of $23 on Friday. Minneapolis-based Medtronic said the acquisition, which it expects to close in the fall, should add to earnings immediately. Shares of Redmond, Wash.-based Physio-Control jumped $3.25 to close at $26.25 on Nasdaq. Medtronic rose 88 cents to close at $63.81 on the New York Stock Exchange.