According to a Reuters press release, a source has revealed that Johnson & Johnson is likely to gain EU approval for its planned $21.3 billion buy of Swiss medical devices maker Synthes, and furthermore that the approval may come before the expected April 26th planned date. According to “a person familiar with the matter” the approval will go through after J&J offered concessions to address concerns over its dominance in trauma devices.
Synthes will be J&J’s largest ever acquisition and will boost its orthopaedics franchise significantly. We announced here last November that the EU commission would investigate the potential acquisition. J&J submitted its proposals to the European Commission last month.
Comments from “the source”
“The deal will be cleared by the Commission,” said the person who declined to be identified because of the sensitivity of the matter.
The EU executive, which is scheduled to decide by April 26 whether to approve the takeover, could issue a decision earlier than that deadline, the person said.
A second mystery “person with direct knowledge” of the case said J&J’s concessions related to trauma products which are used to treat bone fractures. Neither J&J nor the Commission provided details on the proposals.
The Commission opened an in-depth investigation in November last year, saying it wanted to make sure that rivals would still be able to compete effectively once the deal is completed.
According to Reuters, medical devices and diagnostics accounted for 40% of J&J’s turnover in 2010. It competes with Stryker and Zimmer.