Johnson & Johnson Announces Definitive Agreement to Acquire Omrix
November 24 2008 - 6:30AM
PR Newswire (US)
Omrix's Biopharmaceutical Expertise Complements ETHICON's
Industry-Leading Surgery Portfolio NEW BRUNSWICK, N.J. and NEW
YORK, Nov. 24 /PRNewswire-FirstCall/ -- Johnson & Johnson
(NYSE:JNJ) and Omrix Biopharmaceuticals, Inc. (NASDAQ: OMRI), a
fully integrated biopharmaceutical company that develops and
markets biosurgical and immunotherapy products, today announced a
definitive agreement whereby Omrix will be acquired for
approximately $438 million in a cash tender offer. Omrix is
expected to operate as a stand-alone entity reporting through
ETHICON, Inc., a Johnson & Johnson company and leading provider
of suture, mesh, hemostats and other products for a wide range of
surgical procedures. The acquisition of Omrix would provide ETHICON
with an opportunity to strengthen its presence in active,
biologic-based hemostats and convergent products for various
surgical applications. ETHICON currently has exclusive distribution
rights in the U.S. and the European Union for EVITHROM(TM) Thrombin
Topical (Human) and EVICEL(TM) Fibrin Sealant (Human), two active,
biologic-based hemostats manufactured by Omrix. ETHICON and Omrix
are also partnering on a Fibrin Pad product candidate, currently in
Phase II clinical trials, as an adjunct to control mild to moderate
soft tissue bleeding. Under the terms of the agreement, Johnson
& Johnson will commence a tender offer to purchase all
outstanding shares of Omrix at $25.00 per share, which is expected
to close by the end of December 2008. The tender offer is
conditioned on the tender of a majority of the outstanding shares
of Omrix's common stock on a fully diluted basis. The closing is
conditioned on Israeli antitrust clearance and other customary
closing conditions. The $358 million estimated net value of the
transaction is based on Omrix's 17.5 million fully diluted shares
outstanding, net of estimated cash on hand at time of closing. The
boards of directors of Johnson & Johnson and Omrix have
approved the transaction. In addition, Robert Taub, Omrix's Founder
and Chief Executive Officer, and entities controlled by Robert
Taub, have agreed to tender approximately 16% of Omrix's
outstanding shares in the tender offer. Alex Gorsky, Company Group
Chairman for Johnson & Johnson with responsibility for the
ETHICON business worldwide, said, "Our partnership with Omrix has
already expanded our capacity to provide innovative, next
generation products that raise the standard of surgical care. We
believe this transaction will further enhance our efforts to bring
new, science-based products to patients and the healthcare
professionals who treat them." "We are delighted to announce this
transaction, which combines Omrix's expertise in developing
innovative biological products with ETHICON's commercialization
expertise and global reach. We believe this merger is in the best
interest of Omrix's shareholders, customers and employees,"
commented Robert Taub. "Omrix and ETHICON have enjoyed a solid
partnership for the past five years. As a formally unified entity,
our successful distribution and development agreements will evolve
into an even more attractive long-term growth strategy. Omrix's
Israeli-based manufacturing and research & development
expertise will be strengthened by the long-term stability and
integration that this merger will create." Assuming this
transaction closes in 2008, Johnson & Johnson is expected to
incur an estimated one-time, after-tax charge of approximately $120
million reflecting the write-off of in-process research and
development charges (IPR&D). The acquisition is expected to be
breakeven to slightly dilutive to Johnson & Johnson's earnings
per share in 2009. About Johnson & Johnson Caring for the
world, one person at a time...inspires and unites the people of
Johnson & Johnson. We embrace research and science - bringing
innovative ideas, products and services to advance the health and
well-being of people. Our 119,400 employees at more than 250
Johnson & Johnson companies work with partners in health care
to touch the lives of over a billion people every day, throughout
the world. About Omrix Biopharmaceuticals, Inc. Omrix is a fully
integrated biopharmaceutical company that develops, manufactures
and markets protein-based biosurgery and passive immunotherapy
products. Omrix's biosurgery product line includes products and
product candidates that are used for the control of bleeding, or
hemostasis, and other surgical applications. Omrix's passive
immunotherapy product line includes antibody-rich products and
product candidates for the treatment of immune deficiencies,
infectious diseases and potential biodefense applications. For more
information, please visit http://www.omrix.com/. (This press
release contains "forward-looking statements" as defined in the
Private Securities Litigation Reform Act of 1995. These statements
are based on current expectations of future events. If underlying
assumptions prove inaccurate or unknown risks or uncertainties
materialize, actual results could vary materially from Johnson
& Johnson's and Omrix's expectations and projections. Risks and
uncertainties include the satisfaction of closing conditions for
the acquisition, including clearance under the Hart-Scott-Rodino
Antitrust Improvements Act and receipt of certain other regulatory
approvals for the transaction, the tender of a majority of the
outstanding shares of common stock of Omrix, and the possibility
that the transaction will not be completed; general industry
conditions and competition; economic conditions, such as interest
rate and currency exchange rate fluctuations; technological
advances and patents attained by competitors; challenges inherent
in new product development, including obtaining regulatory
approvals; domestic and foreign health care reforms and
governmental laws and regulations; and trends toward health care
cost containment. A further list and description of these risks,
uncertainties and other factors can be found in Exhibit 99 of
Johnson & Johnson's Annual Report on Form 10-K for the fiscal
year ended December 30, 2007 and Omrix's Form 10-K as filed with
the SEC on March 17, 2008. Copies of these filings, as well as
subsequent filings, are available online at http://www.sec.gov/,
http://www.jnj.com/, http://www.omrix.com/ or on request from
Johnson & Johnson or Omrix. Neither Johnson & Johnson nor
Omrix undertakes to update any forward-looking statements as a
result of new information or future events or developments.)
Additional Information The tender offer described in this release
has not yet commenced, and this release is neither an offer to
purchase nor a solicitation of an offer to sell securities. At the
time the tender offer is commenced, Johnson & Johnson will file
a tender offer statement with the U.S. Securities and Exchange
Commission (SEC). Investors and Omrix stockholders are strongly
advised to read the tender offer statement (including an offer to
purchase, letter of transmittal and related tender offer documents)
and the related solicitation/recommendation statement that will be
filed by Omrix with the SEC, because they will contain important
information. These documents will be available at no charge on the
SEC's website at http://www.sec.gov/. In addition, a copy of the
offer to purchase, letter of transmittal and certain other related
tender offer documents (once they become available) may be obtained
free of charge by directing a request to Johnson & Johnson at
http://www.jnj.com/, or Johnson & Johnson, One Johnson &
Johnson Plaza, New Brunswick, NJ 08933, Attn: Corporate Secretary's
Office. DATASOURCE: Johnson & Johnson CONTACT: Bill Price,
+1-732-524-6623, +1-732-668-3735 (m), or Jeffrey J. Leebaw,
+1-732-524-3350, +1-732-642-6608 (m), both of J&J Corporate
Communications; Stan Panasewicz of J&J Investor Relations,
+1-732-524-2524; or Francesca DeMartino of Omrix Investor
Relations, +1-212-887-6510 Web Site: http://www.jnj.com/
http://www.omrix.com/
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