November 22, 2022 | Health Care | North America | Ended

Abiomed / Johnson & Johnson: Deal Insight

On 1-Nov-22, pharma and medical devices giant Johnson & Johnson (“J&J”) announced a definitive agreement to acquire heart pump maker, Abiomed, for an enterprise value of $16.6bn, or $380 cash per share. The offer implies a 50.7% one-day premium and is just shy of Abiomed’s 52-week high, near the level shares traded four years ago. This deal will be J&J’s largest takeover since its $30bn acquisition of Actelion in 2017 and its largest device deal since its $20bn acquisition of Synthes in 2012. An interesting aspect of the offer consideration is an additional non-tradable contingent value right (CVR) that will be given to Abiomed shareholders, worth up to $35 per share. Payments of the CVR are split into three tranches based on specific milestones: (i) $17.50 if Abiomed’s product sales exceed $3.7bn during 2Q’27-1Q’28 (if achieved at a later date during any rolling four quarters through J&J’s 1Q’29, the CVR will be reduced to $8.75), (ii) $7.50 if Abiomed’s Impella receives FDA approval for use in ST-Segment Elevation Myocardial Infarction (STEMI) patients without cardiogenic shock, by ...

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