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news.Guidant Corporation has accepted a new $24.2 billion takeover bid from Johnson & Johnson. The deal represents a $1 billion increase on J&J's previous bid, but is still short of the $24.8 billion offer from Boston Scientific.
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The boards of directors of both companies have unanimously approved the revised Johnson & Johnson offer and the Guidant board of directors will recommend that its shareholders vote in favor of the revised merger agreement at the shareholder meeting at the end of January.
Under the new agreement, Johnson & Johnson will pay $40.52 in cash and 0.493 shares of its common stock for each outstanding share of Guidant common stock. The transaction has a per share value of $71 to Guidant shareholders.
“This agreement with Johnson & Johnson provides significant financial value and certainty for shareholders,” said James Cornelius, chairman and CEO of Guidant Corporation. “Together with Johnson & Johnson, we will have the resources to continue to build upon the existing Guidant businesses in our pursuit of meaningful innovations to address cardiovascular disease.”
There has so far been no indication from Boston as to what its next move might be, although the signs are that Guidant would be receptive to a higher counter offer should it receive one.