Boston Scientific Increases Guidant Bid

BOSTON – Boston Scientific Corp. further raised the stakes Thursday in a bidding war to buy rival medical device maker Guidant Corp., boosting its offer by about $330 million in hopes of ousting rival suitor Johnson & Johnson.

Boston Scientific’s sweeter, $73-per share bid came 24 hours after J&J raised its bid for Guidant from $21.5 billion to $23.2 billion. With its new offer of roughly $25 billion, Boston Scientific hopes to turn Guidant’s board away from J&J’s offer and in favor of its proposal quickly.

Boston Scientific said Thursday night it notified Guidant’s board that its latest offer would expire at 4 p.m. EST Friday unless Guidant’s board declared Boston Scientific’s offer superior by then. With such a declaration, Boston Scientific’s offer will remain open until Jan. 24.

J&J and Guidant said in a joint statement Wednesday night that Guidant’s board of directors would recommend shareholders vote in favor of J&J’s offer in a Jan. 31 shareholder meeting.

Under the new offer, Natick-based Boston Scientific will pay $36.50 in cash and $36.50 worth of Boston Scientific shares for each outstanding share of Guidant common stock

J&J’s latest offer would pay $37.25 in cash and 0.493 shares of Johnson & Johnson common stock for each outstanding share of Guidant common stock, or $67.92 per share.

In announcing its initial bid on Sunday, Boston Scientific had said that offer totalled "$25 billion in the aggregate" based on that bid’s $72 per-share price. But in announcing the revised offer Thursday night, Boston Scientific said its intial offer had been $24.6 billion, and that it boosted the total another $330 million in its revised offer, to just under $25 billion.

In December 2004, J&J offered $25.4 billion for Indianapolis-based Guidant, but lowered the amount to $21.5 billion 11 months later because of Guidant’s product recalls and regulatory investigations.

Since June, Guidant has recalled or issued safety warnings about 88,000 heart defibrillators and almost 200,000 pacemakers. The company also faces numerous lawsuits.