 "J&J to buy cardiovascular technology Abiomed in $16.6 billion deal")
Johnson & Johnson will spend $16.6 billion to buy cardiovascular technology company Abiomed to strengthen its medical device division.
The health care giant said Tuesday that it will pay $380 for each Abiomed share and also provide another $35 per share in cash if some commercial and clinical milestones are met.
Abiomed develops technology that treats coronary artery disease and heart failure. That includes Impella heart pumps, which are used for patients with severe coronary artery disease.
J&J says the deal, which is expected to close early next year, will help the company build its medical device segment by entering a high-growth business.
J&J announced nearly a year ago, that it was turning its focus more to medical devices and its largest business, pharmaceuticals, by splitting off its consumer health division that sells Band Aids and beauty products.
Abiomed will run as a standalone business within J&J's medical device segment once the deal is completed.
J&J will pay for the acquisition with a combination of cash and short-term financing. The company expects the deal to be neutral or slightly dilutive to adjusted earnings in the first year after its completion and then will start helping its bottom line in 2024.
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