Full Breakdown
Apollo Global Management in Talks to Acquire Johnson & Johnson’s DePuy Synthes Orthopedics Unit
By Drooid · · How we work
Deal Context and Valuation
On September 11, reports indicated that alternative-asset manager Apollo Global Management entered discussions to purchase Johnson & Johnson’s orthopedics division, DePuy Synthes. Sources cited by Reuters and Bloomberg said the potential transaction could be valued at close to $20 billion. Bloomberg Intelligence analyst Matt Henriksson estimated a higher figure of $28 billion including debt. The talks come amid a broader wave of private-equity interest in healthcare assets, following recent large-scale acquisitions such as American Industrial Partners’ $1.27 billion purchase of Avanos Medical and the $18 billion Blackstone-TPG deal for Hologic.
Financial Profile of DePuy Synthes
DePuy Synthes, which manufactures joint implants and surgical devices, generated $9.3 billion in sales in the most recent fiscal year, according to both Reuters and Bloomberg. The unit has been a significant revenue source for Johnson & Johnson but has also faced “thousands of lawsuits” related to its hip-replacement products. If spun off as a standalone company, Johnson & Johnson has projected that DePuy Synthes would become “the world’s largest orthopedics company.”
Official Statements from Johnson & Johnson and Apollo
Apollo and Johnson & Johnson declined to comment on the negotiations when approached by Reuters and Bloomberg.
Market Reaction
Following the news, Johnson & Johnson’s shares were “little changed at $265.58” in New York trading, leaving the conglomerate with a market capitalization of roughly $640 billion. Apollo’s shares rose 0.8 % to $128.98, valuing the firm at about $76 billion.
Future Outlook
The parties indicated that an agreement could be reached “within several weeks,” though the discussions could end without a deal or be overtaken by another bidder. Johnson & Johnson retains the option to spin off DePuy Synthes as a publicly traded company instead of a sale. The outcome will shape the scale of private-equity exposure to the orthopedics market and could influence future consolidation trends in the broader healthcare sector.