(Boursier.com) — Johnson & Johnson announces this Friday the acquisition of Shockwave Medical for an enterprise value of $13.1 billion or $335 per share. The premium appears modest on Shockwave’s latest listed prices, at around $320, but the stock had already soared by 27% over one month and 64% since the start of the year with speculation. We can estimate this premium at 17% compared to prices at the end of March, before the Wall Street Journal mentioned discussions between the two groups.
The transaction will allow J&J to strengthen its portfolio of medical devices used in the treatment of heart disease. The transaction is also the largest for Johnson & Johnson since the acquisition of Abiomed for $16.6 billion in 2022. The finalization of the acquisition of Shockwave is expected in the middle of the year.
Joaquin Duato, Chairman and Chief Executive Officer of Johnson & Johnson, said: “With our focus on innovative medicine and medical technologies, Johnson & Johnson has a long history of tackling cardiovascular disease, the leading cause of death worldwide. “The acquisition of Shockwave and its cutting-edge IVL technology provides a unique opportunity to accelerate our impact in cardiovascular intervention and drive greater value for patients, shareholders and health systems.”
The transaction will be accretive to the operating margin of Johnson & Johnson and Johnson & Johnson MedTech. Johnson & Johnson expects the transaction to be operationally accretive upon closing, but given the impact of financing costs, it is expected to dilute adjusted earnings per share by approximately $0.10 in 2024 and $0.17 in 2025.
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