Revised J&J/Guidant Merger Agreement

Posted by Bill Sjostrom

The Amended and Restated Agreement and Plan of Merger for the J&J/Gudiant deal is now available on the SEC’s website (click here).  I took a quick look at this new agreement and noted the following:

•    The exchange ratio for the conversion of GDT stock into JNJ stock is now fixed at .493 per share.  The original agreement provided for a formula based conversion ratio (discussed in this earlier post).
•    The cash portion of the deal has been upped from $30.50 to $33.25 per share.
•    The termination fee applicable to JNJ has been reduced from $700 million to $300 million.
•    The termination fee applicable to GDT has been reduced from $750 million to $625 million.
•    Very little was added to the agreement to address the developments leading to the revised deal.  It looks as if none of GDT’s representations and warranties were changed.  However, they are now all subject to anything disclosed in GDT’s SEC filings prior to 11/14/05 (the date the revised deal was executed) and supplemental disclosure provided to JNJ by GDT since execution of the original agreement.