Johnson & Johnson to acquire Abiomed

US healthcare giant Johnson & Johnson (NYSE: JNJ) yesterday revealed it is making its largest acquisition in six years and potentially one of the biggest deals by a pharma this year.

J&J will acquire Abiomed (Nasdaq: ABMD) through a tender offer all outstanding shares of Abiomed, for an upfront payment of $380.00 per share in cash, corresponding to an enterprise value of approximately $16.6 billion which includes cash acquired. Shareholders of Abiomed, a world leader in breakthrough heart, lung and kidney support technologies, will also receive a non-tradeable contingent value right (CVR) entitling the holder to receive up to $35.00 per share in cash if certain commercial and clinical milestones are achieved. The transaction was unanimously approved by both companies’ boards of directors and Abiomed closed up 50% $377.82.

The transaction broadens Johnson & Johnson MedTech’s (JJMT) position as a growing cardiovascular innovator, advancing the standard of care in one of healthcare’s largest unmet need disease states: heart failure and recovery. Cardiovascular disease is the number one cause of death. All forms of cardiovascular disease lead to heart failure, which is a significant cost to health systems due to hospitalizations and extended length of stay.