Guidant Saga Stretches On

According to a report, J&J is trying to prevent Guidant from saying Boston Scientific's offer is better.
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Updated from 11:36 a.m. EST

The board of medical-device company

Guidant

(GDT)

is reportedly meeting Wednesday afternoon to determine which of the firm's two pursuers would make the best merger partner.

Guidant's board has to decide whether to stick with the plan to be acquired by New Jersey's

Johnson & Johnson

(JNJ) - Get Report

for $21.4 billion, or to go with a higher offer, worth $25 billion, from

Boston Scientific

(BSX) - Get Report

.

Cable television network

CNBC

reported that the meeting was taking place, and that it started around 3 p.m. EST.

Guidant's directors appeared ready to say they had decided Boston was proposing the superior deal, according to a report in

The New York Times

. However, J&J has stepped in to try to prevent such a declaration, the

Times

said, citing people who were involved with the matter. The report said it wasn't clear if J&J has raised its bid.

J&J wouldn't confirm the information and representatives for Guidant and Massachusetts-based Boston Scientific couldn't immediately be reached.

Boston's offer is valued at $72 a share, while J&J's takeover would be worth around $64 a share for Guidant. The Guidant board has said shareholders will vote on the J&J merger Jan. 31. Of course, that could change if directors opt for Boston's bid.

Guidant, based in Indianapolis, and J&J originally reached a merger valued at $76 a share in December 2004. But after Guidant was hit by a series of heart-device recalls last year, J&J threatened to walk away from the deal before agreeing in mid-November on a lower takeover price. Both sides seemed happy at that point, but last month Boston Scientific came in with a higher offer for Guidant.

Guidant's board has publicly supported the prospect of being bought by J&J. Over the weekend, Boston Scientific made its offer for Guidant definitive, prompting J&J to issue a statement saying that its proposal is the best option.

Boston said at the time that it has reached a binding agreement to sell Guidant's vascular intervention and endovascular businesses to

Abbott Laboratories

(ABT) - Get Report

for more than $4 billion if its takeover is successful.

Lately, shares of Guidant were up $1.03, or 1.5%, to $70.42. J&J was down 44 cents, or 0.7%, at $62.66, and Boston was off 97 cents, or 3.7%, to $25.51.