updraftplus domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/aonyeani76/cryptocurrencypanther/wp-includes/functions.php on line 6131hustle domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/aonyeani76/cryptocurrencypanther/wp-includes/functions.php on line 6131wpforms-lite domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /home/aonyeani76/cryptocurrencypanther/wp-includes/functions.php on line 6131Despite the success of Kenvue’s IPO, Johnson & Johnson remains under allegations that some of its talc products are cancerous.
Kenvue, the consumer-health spinoff announced by Johnson & Johnson (NYSE: JNJ) last year, has become the largest US IPO in over a year after going public on Thursday. The Kenvue brand debuted on the New York Stock Exchange (NYSE), causing J&J’s shares to soar 22% on the same day. At the initial public offering (IPO), Kenvue was priced at $22 a night before its launch. However, the new company’s shares opened at $25.53 and closed at $26.90.
Kenvue sold over 172.8 million shares during its IPO, more than the initial plan of 151 million. It secured approximately $3.8 billion from the sale, pushing the company’s valuation to approximately $41 billion. Following the public launch, Kenvue now trades under the ticker “KVUE” and covers a wide range of top consumer brands like Neutrogena, J&J’s namesake baby powder, Band-Aid, Listerine, Tylenol, and Aveeno.
Speaking on Thursday morning ahead of the debut, Kenvue CEO Thibaut Mongon was confident that millions globally woke up with at least one of the company’s products in their homes. Mongon used to be J&J’s executive vice president and worldwide chair of consumer health. Now, he will serve on Kenvue’s board.
Interestingly, Kenvue has been stacking up profits before its IPO. According to reports filed with the US Securities and Exchange Commission (SEC), the J&J subsidiary generated $14.95 billion in sales for 2022 and a net income of $1.46 billion on a pro forma basis.
Additionally, first-quarter sales were around $3.85 billion, while its net income was about $330 million. It considers these results preliminary as it aims to grow its global annual sales through 2025 by 3-4%.
Despite the success of Kenvue’s IPO, Johnson & Johnson remains under allegations that some of its talc products are cancerous. These products are registered under J & J’s newly created business, Kenvue. However, the IPO filing shows that the spinoff will only respond to talc-related liabilities outside the US and Canada.
After being questioned on the liabilities, Mongon said Kenvue is “laser-focused on what we do best: serving our customers and also our portfolio with the brands that we mentioned”.
The debut of Kenvue has raised hope for the revival of the US IPO market after it collapsed last year. According to Renaissance Capital, the company’s public debut is currently the highest IPO this year. The combined value of the 40 IPOs in 2023 is about $2.4 billion, trailing by over $1 billion compared to Kenvue.
Since 2021, no IPO has surpassed the debut of Rivian, an electric vehicle maker that went public in November 2021. Shares of Rivian (RIVN) spiked by over 50 %, from $78 per price to $106.75. Regardless, Kenvue has overtaken Rivian to become the largest IPO.
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Pharmaceutical powerhouse J&J expects to price its Kenvue IPO shares at $20 to $23 for a potential $40 billion company valuation.
Johnson & Johnson (NYSE: JNJ) plans to price shares of its upcoming Kenvue Inc IPO between $20 and $23. The initial public offering roadshow constitutes more than $151 million shares of common stock and would be valued at $40 billion in the share range.
Johnson & Johnson announced it would launch the Kenvue IPO later this year in what could be the largest of its kind in the US this year. Kenvue, a wholly owned subsidiary of the pharmaceutical giant that comprises its Consumer Health Business, expects to grant the underwriters additional share purchase options. The J&J spinoff would allow a 30-day option to purchase 22,680,600 more shares of common stock. Commentaries explain that this other stock would cover any possible over-allotments during the IPO’s initial launch.
J&J, which reportedly met with prospective investors on Monday, will own 1,716,160,000 shares of Kenvue’s common stock. This stake represents almost 92% of the total outstanding shares of the health spinoff’s common stock. However, J&J’s Kenvue stake could also end up being just under 91% if the underwriters fully exercise their over-allotment option.
In a regulatory filing Monday, Johnson & Johnson estimated that the Kenvue IPO would realize approximately $3.15 million in net proceeds. The New Jersey-based pharmaceutical giant also stated that it would claim all proceeds and profits from related debt-financing transactions. J&J did not specify when it expects to complete its separation from Kenvue. However, the company said it would likely happen by mid to late 2023, with Kenvue trading on the New York Stock Exchange as KVUE.
In a preliminary prospectus filed with the Securities and Exchange Commission (SEC), J&J listed the IPO’s lead underwriters. The pharmaceutical corporation said Goldman Sachs (NYSE: GS), JPMorgan (NYSE: JPM), and Bank of America (NYSE: BAC) are the joint lead book-running managers for the IPO.
Johnson & Johnson’s Consumer Health Business sells products ranging from Band-Aid bandages and Listerine mouthwash to pain reliever Tylenol and Johnson’s baby powder. In addition, the consumer healthcare and medical technology corporation also produces and sells skin care products like Neutrogena and Aveeno.
In 2022, J&J’s Consumer Health Business generated $15 billion in net revenue and $3.8 billion in sales in Q1 2023. According to J&J’s latest earnings report, the unit’s last quarter haul is a more than 7% increase compared to the previous year. Although the pharmaceutical giant beat earnings and revenue expectations for the year’s first quarter, it lowered its pharmaceutical sales guidance.
Johnson & Johnson pulled in $24.75 billion in revenue for the period that ended March 31st. The company’s revenue is higher than the $23.67 billion analysts expected. Commenting on the quarterly performance, the company’s Chairman of the Board and Chief Executive Officer Joaquin Duato said:
“Our first quarter results demonstrate strong performance across all three segments of our business and reflect the dedication of Johnson & Johnson colleagues around the world. With this momentum, I look forward to the remainder of the year, one filled with exciting catalysts that will create both near- and long-term value for patients and all of our stakeholders.”
For Q1 2023, J&J also realized earnings per share (EPS) of $2.68 adjusted versus the $2.50 consensus estimate.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
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