WSJ.com – Guidant Files Suit Against J&J To Force Completion of Merger
From todays WSJ:
Guidant Corp. filed a federal lawsuit Monday seeking to force health-care conglomerate Johnson & Johnson to close its $25.4 billion acquisition of Guidant, a deal J&J has soured on due to safety problems with Guidant’s heart devices.
But even as Guidant escalated the dispute, it became apparent that Guidant’s own legal woes had worsened, as Guidant disclosed Monday the Securities and Exchange Commission had begun a formal inquiry into its product disclosures and trading in Guidant shares. Also, Guidant reported a substantial decline in third-quarter earnings and sales, citing the product recalls. …
Some legal experts say Guidant’s mounting legal issues could provide ammunition to J&J in arguing that Guidant’s prospects have gotten materially worse since J&J agreed to the acquisition in December 2004.
I don’t have a dog in this hunt, but think it takes some nerve to sue for the deal you had when things are getting so bad the SEC wants to look at your dealings.
