Gosh, just a little over two months ago, Johnson & Johnson was threatening to walk on its proposed $25.4 billion ($76 per share) merger with Guidant. J&J eventually agreed to stay in the deal after Guidant agreed that J&J could knock $4 billion off the purchase price.
But then, Boston Scientific got in the game for Guidant. Before you know it, J&J was making nice with Guidant and had increased its bid for Guidant back up to $24.2 billion ( $40.52 in cash and .493 shares of J&J stock for each Guidant share) with a quick closing date. Guidant’s board accepted that revised offer and J&J heaved a sigh of relief until . . .
Boston Scientific announced this morning that it had increased its bid for Guidant to an eye-popping $80 a share or more than $27 billion. With that offer, it now appears that J&J may have to raise its offer to above the $25.4 billion, $76 per share offer that J&J originally agreed to pay for Guidant.
Does anyone else get the sense that J&J wished it had never heard of such things as “material adverse effects” and Eliot Spitzer?
Update: And Guidant has switched allegiances and now supports Boston Scientific’s new bid.