Healthcare products company Johnson & Johnson (J&J) (NYSE:JNJ) and cardiovascular medical device company Shockwave Medical Inc (Nasdaq:SWAV) announced on Friday a definitive agreement for JNJ to acquire all outstanding shares of Shockwave for USD335.00 per share in cash, totalling approximately USD13.1bn including cash acquired.

This acquisition enhances JNJ's position in cardiovascular intervention, tapping into high-growth segments like coronary artery disease (CAD) and peripheral artery disease (PAD). Shockwave's innovative intravascular lithotripsy (IVL) technology for calcified CAD and PAD treatment complements JNJ's existing portfolio.

Post-transaction, Shockwave will operate as a unit within JNJ MedTech, further bolstering its presence in cardiovascular healthcare.

The deal is projected to accelerate sales growth and enhance operating margins for both JNJ and JNJ MedTech, albeit with a slight dilution in adjusted earnings per share in 2024 and 2025 due to financing costs.

Subject to shareholder and regulatory approvals, the transaction is expected to close by mid-year 2024.