Johnson & Johnson To Buy Shockwave In $13.1 Bln Deal

(RTTNews) - Drug major Johnson & Johnson (JNJ) announced Friday its agreement to acquire Shockwave Medical, Inc. (SWAV) for $335.00 per share in cash. The enterprise value of the deal is around $13.1 billion including cash acquired.

The transaction is expected to accelerate revenue growth for both Johnson & Johnson and Johnson & Johnson MedTech.

The deal will be accretive to operating margin for both the company and MedTech division. Johnson & Johnson expects the transaction to be operationally accretive upon closing, but considering the impact of financing costs, is expected to dilute adjusted earnings per share by approximately $0.10 in 2024 and approximately $0.17 in 2025.

The acquisition was approved by both companies' boards of directors, and will be funded through a combination of cash on hand and debt.

The closing of the deal is expected to occur by mid-year 2024 subject to the receipt of Shockwave's shareholder approval, as well as the receipt of applicable regulatory approvals and other customary closing conditions.

Following completion of the deal, Shockwave's common stock will no longer be listed for trading on the Nasdaq Global Select Market.

Shockwave is a first-to-market provider of innovative intravascular lithotripsy or IVL technology for the treatment of calcified coronary artery disease or CAD and peripheral artery disease or PAD.

IVL is a minimally invasive, catheter-based treatment for calcified arterial lesions, which can reduce blood flow and cause pain or heart attack.

Shockwave offers the first and only commercially available IVL technology and has safely, simply, and effectively treated around 400,000 patients globally. Shockwave also recently acquired Neovasc Inc., the developer of Reducer System, a novel product focused on symptom relief of refractory angina.

Johnson & Johnson said the acquisition of Shockwave accelerates Johnson & Johnson MedTech's ongoing efforts to increase its presence in high-growth markets with unmet need, while expanding its reach and scale globally.

Following the acquisition, Shockwave will operate as a business unit within Johnson & Johnson MedTech. Shockwave would become Johnson & Johnson MedTech's thirteenth priority platform, as defined by annual sales of at least $1 billion.

In addition to his current responsibilities for Abiomed as the Global Head of Heart Recovery, Michael Bodner will assume responsibility for the business upon close. Isaac Zacharias, most recently serving as President and Chief Commercial Officer, will transition to become Worldwide President of Shockwave, reporting to Bodner.

Doug Godshall, Shockwave's President and Chief Executive Officer, will advise through the transition.