Johnson & Johnson and Cordis Corporation Announce $1.8 Billion Merger

Johnson & Johnson and Cordis Corporation have signed a definitive merger agreement for a $1.8 billion stock-for-stock merger. The transaction values Cordis at $109 per share, based on the average of the closing prices of Johnson & Johnson shares for the ten trading days prior to the closing of the merger. The merged company will be called Cordis, a Johnson & Johnson Company, and will be headquartered in Miami, Florida. The merger requires the approval of the holders of a majority of the outstanding Cordis shares and is expected to be completed within approximately 90 days.

Key Takeaways:

• The merger agreement values Cordis at $1.8 billion, net of cash, based on approximately 17.6 million shares outstanding on a fully diluted basis.
• The merged company will be called Cordis, a Johnson & Johnson Company, and will be headquartered in Miami, Florida.
• The merger requires the approval of the holders of a majority of the outstanding Cordis shares.
• Johnson & Johnson will conduct a due diligence review of Cordis during the next 45 days and has the right to terminate the merger agreement based on that review.
• The merger is expected to be completed within approximately 90 days, following the approval of the Cordis shareholders.
• Cordis Corporation and its subsidiaries manufacture and market a variety of medical devices and systems for the cardiology, electrophysiology, radiology, interventional neuroradiology, and neurosciences markets.
• Johnson & Johnson is the world's largest and most comprehensive manufacturer of health care products, with approximately 82,000 employees and operations in 50 countries.

Statistics:

• The merger values Cordis at $109 per share, based on the average of the closing prices of Johnson & Johnson shares for the ten trading days prior to the closing of the merger.
• The merged company will have a total equity value, net of cash, of approximately $1.8 billion.
• Johnson & Johnson reported consolidated sales of $14.0 billion for the first nine months of 1995, an increase of 20.2% over worldwide sales of $11.64 billion for the same period a year ago.
• Consolidated earnings for the first nine months of 1995 were $1.94 billion, up 19.0%.

Sources:

• Johnson & Johnson and Cordis Corporation, "PR Newswire," November 13, 1995.
• Johnson & Johnson Annual Report, 1995.
• Cordis Corporation Website, 1995.