Deal is expected to enhance Ethicon’s business.

Johnson & Johnson inked a definitive agreement whereby Omrix will be acquired for approximately $438 million in a cash tender offer. Omrix is expected to operate as a stand-alone entity reporting through Ethicon, a J&J company.

Under the terms of the agreement, Johnson & Johnson will commence a tender offer to purchase all outstanding shares of Omrix at $25 per share, which is expected to close by the end of this year. The tender offer is conditioned on the tender of a majority of the outstanding shares of Omrix’s common stock on a fully diluted basis.

The $358 million estimated net value of the transaction is based on Omrix’ 17.5 million fully diluted shares outstanding, net of estimated cash on hand at time of closing. The boards of directors of Johnson & Johnson and Omrix have approved the transaction. In addition, Robert Taub, Omrix’ founder and CEO, and entities controlled by Taub, have agreed to tender approximately 16% of Omrix’s outstanding shares in the tender offer.

“We are delighted to announce this transaction, which combines Omrix’  expertise in developing innovative biological products with Ethicon’s commercialization expertise and global reach. We believe this merger is in the best interest of Omrix’  shareholders, customers, and employees,” commented Taub.

Omrix develops, manufactures, and markets protein-based biosurgery and passive immunotherapy products. Omrix’  biosurgery product line includes products and product candidates that are used for the control of bleeding and other surgical applications. Omrix’ passive immunotherapy product line includes antibody-rich products and product candidates for the treatment of immune deficiencies, infectious diseases, and potential biodefense applications.

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