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news.Medical device maker Guidant has agreed to accept a sweetened cash-and-stock takeover offer of $23.2 billion from Johnson & Johnson, despite J&J's bid falling short of the $25 billion bid tabled by Boston Scientific.
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The boards of directors of both companies have unanimously approved the revised J&J offer and the Guidant board of directors is recommending its shareholders vote in favor of the revised merger.
The transaction has a per share value of $68.06 to Guidant shareholders. However, Boston is offering shareholders a slightly better deal promising $72 per share.
Boston Scientific commented on the recent developments stating: “It is clear that our $72 per share offer is superior to the $68.06 per share now being offered by Johnson & Johnson. Our discussions with Guidant are ongoing. We intend to vigorously pursue this transaction to its completion.”
In December 2004 J&J had agreed to pay $25.4 billion for Guidant. However, product recalls at Guidant and associated litigation led the companies to agree a revised deal in November 2005 under which J&J negotiated a reduction of almost $4 billion on the original deal. It was around this time that Boston first proposed its rival bid.