Wednesday, June 13, 2012

J&J Searches for Redemption with Synthes

J&J's still searching for redemption and its hoping Synthes is the ticket.  Although the $19.7 billion acquisition, which got the greelight today, is raising eyebrows for its tax evasion methodology.  J&J is hoping to add 3-5 cents per share to its 2012 earnings, reducing the impact of its OTC product mess.

J&J will buy Synthes via an Irish subsidiary, so it can buy the firm with funds that haven't been repatriated and avoiding U.S. taxes.

The Synthes acquisition makes sense for J&J, but we've spent so long by being disappointed by J&J, it's like waiting for the other shoe to drop.

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