J&J Is in Talks to Sell Its Hips-and-Knees Business to Apollo for $20 Billion
The health-products company said it planned to hive off its DePuy Synthes unit to focus on higher-growth areas
- Apollo Global Management is in talks to buy Johnson & Johnson’s hips-and-knees parts business for around $20 billion, according to sources.
- Johnson & Johnson has been seeking to offload its DePuy Synthes orthopedics business to focus on higher-growth areas.
- The orthopedics unit generated $9.3 billion in sales last year, accounting for less than a tenth of Johnson & Johnson’s total revenue.
Private-equity firm Apollo Global Management APO 0.84%increase; up pointing triangle is in talks to acquire Johnson & Johnson’s hips-and-knees parts business for around $20 billion, according to people familiar with the matter.
J&J has been seeking to unload its DePuy Synthes orthopedics business. It is possible the talks with Apollo won’t result in a transaction, however, or another suitor could still emerge, the people cautioned.
The hips-and-knee unit, which also makes instruments to repair bones and joints, had been a linchpin of J&J’s medical-device business. The company acquired the bone-repair device maker Synthes in 2012 for $21 billion and combined it with its DePuy unit to create the “most innovative and comprehensive” orthopedics business, then-Chief Executive Bill Weldon said at the time.
Its growth has slowed in recent years. Last fall, Johnson & Johnson said it wanted to separate the unit into a stand-alone business. The company said it was exploring various paths to complete the separation, which it aimed to finish within 18 to 24 months.
“It’s a steady grower, but not outperforming,” J&J Chief Financial Officer Joseph Wolk told The Wall Street Journal at the time.
The unit’s $9.3 billion in sales last year accounted for less than a tenth of J&J’s total revenue. Bloomberg News on Friday reported news of the sale talks.
The move is part of a broader effort to shift J&J, of New Brunswick, N.J., toward higher-growth areas. In 2023, J&J split off its consumer-health division, called Kenvue, known for brands like Tylenol and Band-Aid. Kimberly-Clark has agreed to buy Kenvue for more than $40 billion.