Johnson & Johnson to buy Mentor

Healthcare products giant Johnson & Johnson has agreed to buy Mentor Corporation, a leading supplier of medical products for the global aesthetic market, in a deal valued at approximately $1.07 billion. ┬á The companies announced that Johnson & Johnson will purchase all of MentorÔÇÖs outstanding shares at $31.00 per share, almost double MentorÔÇÖs closing share price on Friday. ┬á Following the acquisition, Mentor is expected to operate as a stand-alone business unit reporting through the Johnson & Johnson subsidiary ETHICON, a leading provider of suture, mesh, and other surgical products. ┬á The companies estimated that the deal will lower Johnson & JohnsonÔÇÖs earnings in 2009 by $0.03 to $0.05 per share, but both firms said in a statement that the purchase is meant to strengthen Johnson & JohnsonÔÇÖs presence in aesthetic and reconstructive medicine. ┬á ÔÇ£The addition of Mentor, a market-leader and one of the most respected companies in the aesthetic space, expands our capacity to provide physicians with products that can restore patientsÔÇÖ appearance, self-esteem, and quality of life,ÔÇØ said Alex Gorsky, Company Group Chairman for Johnson & Johnson with responsibility for the ETHICON business worldwide. ┬á The acquisition is also said to raise the standard for innovation and patient outcomes in the aesthetic and reconstructive medicine market. John Levine, President and CEO of Mentor said, ÔÇ£ETHICON and Mentor share a common set of values in terms of commercial market leadership, the commitment to developing innovative, science based products, and unwavering service to physicians and patients.ÔÇØ┬á Levine added, ÔÇ£The transaction allows Mentor to expand our product portfolio and significantly grow our global reach. The opportunity to become part of ETHICON, one of the largest and most respected surgical companies in the world, will have a positive impact on our business and on all our key constituents.ÔÇØ┬á The deal has been approved by the boards of directors of both companies and is projected to close in the first quarter of 2009. ┬á