8-KMaterial AgreementsExhibits & Filings

JOHNSON & JOHNSON 8-K Report, Material Agreement (May 8, 2023)

Filed May 8, 2023For Securities:JNJ

Summary

Johnson & Johnson (JNJ) has reported the completion of Kenvue Inc.'s initial public offering (IPO) on May 8, 2023. Kenvue, previously a wholly-owned subsidiary, offered 198,734,444 shares at $22.00 per share, raising approximately $4,241 million in net proceeds. These proceeds will be paid to Johnson & Johnson as partial consideration for the consumer health business transferred to Kenvue. Following the IPO, Johnson & Johnson retains a significant stake, owning approximately 89.6% of Kenvue's outstanding common stock. As a result, Johnson & Johnson will continue to consolidate Kenvue's financial results. The company also entered into a comprehensive Separation Agreement with Kenvue, outlining key corporate actions, asset and liability allocation, and agreements related to Kenvue's relationship with Johnson & Johnson post-IPO, including potential future dispositions of Kenvue shares.

Key Highlights

  • 1Kenvue Inc., Johnson & Johnson's consumer health business, successfully completed its IPO on May 8, 2023, raising approximately $4.24 billion.
  • 2Johnson & Johnson retains a controlling stake of approximately 89.6% in Kenvue following the IPO.
  • 3Johnson & Johnson will continue to consolidate Kenvue's financial results into its own.
  • 4Proceeds from the IPO will be paid to Johnson & Johnson as partial consideration for the transferred consumer health business.
  • 5A comprehensive Separation Agreement was executed between JNJ and Kenvue, detailing terms of separation, asset/liability allocation, and future relationship.
  • 6Various other material agreements, including tax, employee matters, intellectual property, trademark, and registration rights agreements, were finalized.
  • 7The IPO and related agreements are part of Johnson & Johnson's strategic plan to separate its consumer health business.

Frequently Asked Questions

The Kenvue IPO marks a significant step in Johnson & Johnson's strategy to separate its consumer health business. While Johnson & Johnson retains a controlling stake, the IPO provides substantial capital and begins the process of establishing Kenvue as an independent entity. Investors can view this as a move to potentially unlock value and allow JNJ to focus on its pharmaceutical and medical device segments.

No, Johnson & Johnson no longer fully owns Kenvue. While they retain a controlling interest of approximately 89.6% after the IPO, Kenvue is now a publicly traded company with shares held by external investors. Johnson & Johnson will continue to consolidate Kenvue's financials due to its majority ownership.

The Separation Agreement covers the principal corporate actions and reorganization related to the transfer of the consumer health business, the allocation of assets and liabilities between Johnson & Johnson and Kenvue, and their respective rights and obligations concerning the IPO. It also outlines agreements regarding any future disposition of Kenvue shares by Johnson & Johnson and other aspects of their post-IPO relationship.

The net proceeds of approximately $4.24 billion from Kenvue's IPO will be paid to Johnson & Johnson as partial consideration for the consumer health business that was transferred to Kenvue in connection with the IPO.