Johnson & Johnson ups offer for Guidant to $71 a share

By E. Janene Geiss

Philadelphia, Jan. 13 - Johnson & Johnson said late Friday that it has reached a new agreement to acquire Guidant Corp. for $71 a share or $24.2 billion in fully diluted equity value.

It is the second revised offer in as many days, and comes a day after Boston Scientific Corp. upped its offer to acquire Guidant in a cash and stock deal worth $73 per Guidant share or $25 billion.

The boards of directors of both companies have unanimously approved the revised Johnson & Johnson offer and the Guidant board of directors recommends that Guidant shareholders vote in its favor at the Jan. 31 shareholder meeting, according to a company news release.

Under the new agreement, Johnson & Johnson will pay $40.52 in cash and 0.493 shares of Johnson & Johnson common stock for each outstanding share of Guidant common stock.

Valued as of the market close Jan. 13, the transaction has a per share value of $71 to Guidant shareholders, officials said.

"This agreement with Johnson & Johnson provides significant financial value and certainty for shareholders," James Cornelius, chairman and chief executive officer of Guidant, said in the release.

On Thursday, Boston Scientific made a new offer for Guidant valued at $73 a share split evenly between cash and stock, subject to a collar. That was up $1 from an offer announced Monday. The deal includes selling Guidant's vascular intervention and endovascular business to Abbott Laboratories for $3.8 billion and shared rights with Abbott on Guidant's drug-coated stent business.

Boston Scientific said its new offer was meant to settle several issues, including any perceived antitrust concerns, officials said.

But Johnson & Johnson said chairman and chief executive officer William C. Weldon said in the Friday release that the companies are eager to close their deal and begin integration plans they've been developing over the last year.

"Together, we are ready to execute our plans focused on creating the world's broadest and most comprehensive cardiovascular device company that will bring meaningful technology solutions to address this devastating disease," he said.

New Brunswick, N.J.-based Johnson & Johnson is a manufacturer and marketer of health care products.

Guidant, based in Indianapolis, develops therapies for cardiac and vascular disease.

Boston Scientific is a Natick, Mass., maker of medical devices, including heart devices.

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