Medical device maker Integra Lifesciences (IART) - Get Integra LifeSciences Holdings Corporation Report has announced that it will acquire Johnson & Johnson's (JNJ) - Get Johnson & Johnson (JNJ) Report Codman Neurosurgery business for $1.05 billion. 

"This proposed transformational acquisition of Codman Neurosurgery creates compelling value for our shareholders, employees and patients," said Peter Arduini, Integra's CEO, in a statement. 

JNJ's Codman unit includes a portfolio of medical devices that focuses on advanced hydrocephalus, neuro-critical care and operative neurosurgery, according to the company. The acquired products generated approximately $370 million in revenue during 2016, the company stated. 

According to a spokeswoman from JNJ, "if the offer is accepted, the proposed transaction would be expected to close in the fourth quarter of 2017, pending the successful completion of works council consultations, antitrust clearances and other customary closing requirements as applicable."

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JNJ was falling slightly ahead of the market's open, hitting $116 per share, as compared to its Tuesday close of $116.36 per share. Meanwhile, Integra was not moving during the pre-market. The company closed up 1% Tuesday, hitting $43.28 per share. 

Integra officials said they expect the deal to be accretive to adjusted earnings per share by at least 22 cents during the first year. This will also get Integra closer to achieving $2 billion in revenue sooner than it hoped, the company said. 

This isn't the first deal Integra has inked in 2017. The company, on Jan. 11, announced that it would buy Derma Sciences (DSCI) for $204 million.  

JNJ is currently exploring strategic options for its diabetes care unit, which includes its LifeScan, Animas and Calibra Medical divisions. Investors and analysts have been indicating that they believe a divestiture of these assets is the most likely outcome of the review process. The units could fetch a value of between $2 billion and $2.5 billion. 

Once this deal closes, and the diabetes units are divested, JNJ will have excess cash on hand, perhaps to acquire something that fits better within its portfolio. 

Neither JNJ nor Integra could be reached for comment Wednesday morning.