J&J to Purchase Abbott's Eye Surgery Unit for $4.33 Billion
Johnson & Johnson agreed to buy Abbott Laboratories’ eye-surgery equipment unit for $4.33 billion, moving the health-care giant toward its goal of boosting its three core businesses.
The deal is expected to close in the first quarter of 2017, the companies said Friday in separate statements. The medical optics unit makes equipment used in surgeries to repair cataracts and other vision ailments, along with contact lenses. It brought in $1.13 billion in sales for Abbott in 2015.
J&J, the world’s biggest maker of health-care products, has been chasing deals for all three of its main businesses to boost growth and offset potential competition for prescription medicines, the largest unit at the New Brunswick, New Jersey-based company. Abbott is clearing space for its planned acquisitions of Alere Inc., a medical testing company, and St. Jude Medical Inc., another device maker.
J&J’s medical devices and diagnostics business accounted for 36% of revenue in 2015, down from 41 percent in 2012. Consumer products, J&J’s third major unit, had 19% of the company’s sales last year.
Abbot, based in Abbott Park, Illinois, paid $2.8 billion for the medical optics unit in 2009. The company has been trying to back out of its $5.8 billion deal with Alere. It has said it’s committed to acquiring St. Jude, even after a short-seller alleged that some of its heart devices have cybersecurity vulnerabilities, and expects the $25 billion deal to close before the end of the year.
