US healthcare giant Johnson & Johnson (J&J, NYSE: JNJ) has announced the initial public offering (IPO) of 173 million shares by its consumer health spin-off company Kenvue to the New York Stock Exchange (NYSE), raising a staggering USD 3.8 billion. This transaction has secured its place as the biggest IPO in the US so far this year and since November 2021, marking a significant milestone for both companies.
Kenvue’s IPO and J&J’s Stakes
Kenvue had initially targeted a raise of USD 3.25 billion with an issuance of 151 million shares, priced between USD 20 to 23 per share. Following the IPO, Johnson & Johnson will retain a substantial 91% stake in Kenvue. Should all underwriter rights be exercised, J&J’s ownership could increase to 90%, demonstrating the parent company’s continued confidence in its spin-off’s prospects.
J&J’s Strategic Decision to Spin Off Consumer Health Business
Johnson & Johnson announced its strategic decision to hive off its Consumer Health business into a separate entity in November 2021. This spin-off is a testament to the company’s commitment to focusing on its core competencies while allowing Kenvue to operate with greater autonomy. The new company will be segmented into Self Care, which includes over-the-counter (OTC) drugs, and additional divisions focused on Skin Health and Essential Health, aiming to provide targeted solutions in these specific areas of consumer health.-Fineline Info & Tech
