Guidant Acquisition Talks Heat Up as Johnson & Johnson Eyes Deal

Strategic Insights -

Johnson & Johnson is reportedly in advanced talks to acquire Guidant Corp. for more than $24 billion, according to the New York Times. This move follows Johnson & Johnson's plans to integrate its U.S.-based Credit Suisse First Boston investment banking unit with its retail and private banking businesses within two years. Additionally, the company plans to float its Winterthur insurance unit. Meanwhile, IBM and Lenovo Group plan to form a U.S. personal-computer company, with IBM holding a minority stake in the new entity.

Key Takeaways:

  • Johnson & Johnson is in talks to acquire Guidant Corp. for over $24 billion, as reported by the New York Times.
  • Johnson & Johnson plans to integrate its U.S.-based Credit Suisse First Boston investment banking unit with its retail and private banking businesses within two years.
  • The company plans to float its Winterthur insurance unit as part of its restructuring efforts.
  • IBM and Lenovo Group are forming a U.S. personal-computer company, with IBM holding a minority stake.
  • Guidant Corp. will face restructuring, resulting in a $45 million charge in the fourth quarter and $200 million in charges throughout 2005.
  • Colgate-Palmolive Co. will reduce its payroll by 12%, or 4,450 positions, and close 78 factories worldwide over the next four years.
  • Gold Fields Ltd. shareholders voted against the company's plan to merge its non-southern African assets with IAMGold Corp.
  • Harmony Gold Mining Co. Ltd. has made a $6.5 billion hostile takeover bid for Gold Fields Ltd.

Statistics:

  • Johnson & Johnson's proposed acquisition of Guidant Corp. is valued at over $24 billion.
  • Johnson & Johnson plans to integrate its Credit Suisse First Boston unit within two years.
  • The restructuring at Colgate-Palmolive Co. will result in $45 million in charges in the fourth quarter and $200 million throughout 2005.
  • Colgate-Palmolive Co. plans to reduce its payroll by 12% and close 78 factories worldwide over the next four years, resulting in estimated savings of $250 million to $300 million per year.
  • Gold Fields Ltd. shareholders voted against the proposed merger with IAMGold Corp.
  • Harmony Gold Mining Co. Ltd.'s hostile takeover bid for Gold Fields Ltd. totals $6.5 billion.

Sources:

  • New York Times
  • ODJ Select via COMTEX
  • COMTEX
  • Credit Suisse Group (CSR)
  • International Business Machines Corp. (IBM)
  • Colgate-Palmolive Co. (CL)
  • Gold Fields Ltd. (GFI)
  • IAMGold Corp. (IAG)
  • Harmony Gold Mining Co. Ltd. (HMY)