IPO Valuation Of Kenvue Of Johnson & Johnson Will Exceed $40 Billion In Big Debut Since 2021

Johnson & Johnson is poised for the largest initial public offering (IPO) in over a year after pricing its Kenvue unit's shares at the upper end of expectations on Wednesday evening. 

‍

The IPO will offer shares in Kenvue, which holds a range of consumer brands including Band-Aid, Tylenol, and Listerine, and is expected to begin trading on the New York Stock Exchange under the symbol "KVUE" on Thursday morning. 

‍

Johnson & Johnson sold 172.8 million shares for $22 each, raising more than $3.8 billion and achieving a valuation of over $41 billion. Underwriters have access to an additional 22.7 million shares for overallotments.

‍

The Kenvue IPO will raise more than all the other IPOs combined that have gone to market in 2023 thus far and represents the largest IPO since late 2021. 

‍

Last year, the IPO market stalled after a wave of SPACs (special purpose acquisition companies) resulted in record activity. According to Renaissance Capital data, only 40 IPOs have priced this year, raising a total of $2.4 billion.

‍

A successful IPO for Kenvue may encourage other established companies to pursue public offerings. Arm Ltd., a British chip maker owned by SoftBank Group Corp. and expected to go public after a failed deal with Nvidia Corp. last year, has recently filed confidential paperwork for an offering.

‍

Johnson & Johnson will maintain a 92% ownership stake in Kenvue and plans to distribute the remaining shares to its own shareholders in a deal that could occur in the second half of the year. 

‍

Goldman Sachs, JPMorgan, and BofA Securities are the lead underwriters in a team of 19 banks working on the deal. Trading in Kenvue's shares is expected to begin sometime after the opening bell on the NYSE.

‍