5 Big Deals That May Flop in 2012
2. Johnson & Johnson's $21.3 billion Buy of Synthes.
In April 2011, Johnson & Johnson (JNJ) bought medical device maker Synthes for $21.3 billion, in a push by the world's second largest health products company toward medical devices. However, in November the European Commission launched an "in-depth" investigation into the tie-up.
Synthes is a leading device maker for traumatic injuries and spine repair. With the company, Johnson & Johnson would roughly double its market share in those businesses.The European Commission, which is reported to be close to blocking an exchange merger between NYSE Euronext (NYX) and Deutsche Boerse, has said it has "serious doubts" for the merger because it harm industry competition and innovation. The second review will scrutinize whether the deal harms European consumers, who rely on the two device-making healthcare giants. "The commission needs to make sure that effective competition is preserved, in order to maintain innovation and prevent harm to patients," said European Competition Commissioner Joaquin Almunia in a statement. Even after the second review and an extension to the review that will expire in April, Synthes shareholders approved the merger in mid-December. For more on Johnson & Johnson, see TheStreet's portfolio of the highest yielding drug stocks.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV