“Power of everyday care”: J&J’s Kenvue tops US$47B valuation in biggest IPO in two years

05 May 2023 --- Johnson & Johnson’s (J&J) consumer health subsidiary Kenvue is transitioning from private to public ownership with a momentous US$47 billion initial public offering (IPO). Kenvue’s personal care business has attracted more investors than any other US stock debut in the last two years.

“Helping consumers realize the extraordinary power of everyday care is at the heart of who we are and what we do,” says Thibaut Mongon, CEO at Kenvue.

“As a global leader at the intersection of healthcare and consumer goods, our carefully curated portfolio of science-backed, iconic brands has been trusted by consumers and recommended by healthcare professionals for generations. We are ready to bring a new view of care.”

The pricing of Kenvue’s upsized IPO is 172.8 million shares at US$22 per share. This is anticipated to have a combined valuation of about US$47 billion, while its stock rose 22% upon debut.

The company’s brands include Aveeno, Adhesive Bandages, Johnson’s, Listerine, Neutrogena, Tylenol and Zyrtec.

Yesterday, Kenvue began trading today on the New York Stock Exchange under the ticker symbol “KVUE.”Kenvue’s personal care brands include Aveeno, Johnson’s, Listerine and Neutrogena.

Purchasing shares
The IPO is expected to close on May 8 and is subject to closing conditions.

Once completed, J&J will own 1.7 billion shares of Kenvue’s common stock – representing 90.9% of the total outstanding shares of Kenvue’s common stock.

Underwriters have a 30-day option to purchase up to 25,921,884 shares of its common stock.

Goldman Sachs & Co. LLC, J.P. Morgan and BofA Securities are joint lead book-running managers for the IPO.

Corporate overview
Kenvue had US$15 billion in net sales in 2022 and has over 135 years of experience, with 1.2 billion global consumers.

The company believes that daily care rituals and small moments of care profoundly impact well-being. Moreover, it backs its product solutions with scientific research.

Its 2025 goals include having 100% recyclable, reusable or compostable for all plastic packaging, 100% certified or post-consumer paper and pulp-based packaging while maintaining 100% Roundtable for Sustainable Palm Oil (RSPO) certification for palm oil derivatives.

By 2025, Kenvue aims to have at least 50% of its volumes from RSPO physical supply chains, including 100% renewable electricity for operations. The company also aims to provide greater ingredient transparency. The pricing of Kenvue’s upsized IPO is 172.8 million shares at US$22 per share.

It is investing US$800 million by 2030 to support its ambitions.

Tracking J&J
In recent developments, skin microbiome company, Sequential Skin and J&J reached a collaborative agreement to “quantify skin health.”

Last month, J&J’s subsidiary LTL Management re-filed for voluntary Chapter 11 bankruptcy protection in the US Bankruptcy Court for the District of New Jersey. The company is aiming to resolve all legal claims accusing J&J’s talc powder of containing traces of cancer-causing asbestos with a sum of US$8.9 billion.

This comes after a judge in the Third Circuit Court of Appeals, Philadelphia, “dismissed” LTL’s bid for the same protection in January.

In related financial news, private equity company Apollo Global Management’s affiliate Apollo Funds entered into a definitive merger agreement to acquire chemical and ingredients distributor Univar Solutions, in an all-cash transaction totaling approximately US$8.1 billion.

By Venya Patel

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