Johnson & Johnson (NYSE:JNJ) entered into a definitive transaction agreement to acquire Actelion Ltd (SWX:ATLN) for $29.4 billion on January 26, 2017. Johnson & Johnson will launch a tender offer for all the shares of Actelion and will offer $280 in cash for each Actelion share outstanding. Immediately prior to the completion of acquisition, Actelion will spin out its drug discovery operation and early-stage clinical development assets into a newly created Swiss biopharmaceutical company (R&D NewCo). The shares of R&D NewCo, which will be listed on the SIX Swiss Exchange (SIX), will be distributed to Actelion's shareholders as a stock dividend upon closing of the tender offer transaction. Actelion's shareholders will receive one share of R&D NewCo for each Actelion share as stock dividend. Johnson & Johnson will initially hold 16% of the shares of R&D NewCo and have rights to an additional 16% of R&D NewCo equity through a convertible note. Johnson & Johnson will also receive an option on ACT-132577, a product within R&D NewCo being developed for resistant hypertension currently in phase 2 clinical developments. Johnson & Johnson expects to retain Actelion's presence in Switzerland. Johnson & Johnson will fund the transaction with cash held outside the United States.

Jane Griffiths, will serve as the global head of Actelion. Otto Schwarz, will retire from his position as Chief Operating Officer, upon close of the transaction. Chief Executive Officer Jean-Paul Clozel, Chief Operating Officer André C. Muller and Head of Global Clinical Development Guy Braunstein will leave Actelion's executive committee, which will be dissolved as of settlement, and move to Idorsia Ltd on June 16, 2017. Nicholas Franco will be the member of leadership team going forward. The offer will be launched on or around February 16, 2017. As of, February 16, 2017, the tender offer is expected to commence on March 3, 2017 and is scheduled to expire on March 30, 2017. Following successful completion of the offer, if Johnson & Johnson has acquired at least 90% of the outstanding shares, it intends to acquire any untendered shares pursuant to a short-form merger. If Johnson & Johnson has acquired more than 98% of the outstanding shares, it intends to acquire any untendered shares pursuant to a squeeze-out procedure.

Jean-Paul Clozel, Managing Director, Chief Executive Officer and founding member of Actelion has committed to tender all Actelion shares he owns into the offer and vote his shares in favor of the transaction at the Extraordinary General Meeting. The transaction is conditional upon, at least 67% of all Actelion shares that are issued and outstanding at the end of the offer period, which may be extended, tendering into the offer and the approval of the Actelion shareholders for the distribution of the shares of R&D NewCo at the Extraordinary General Meeting (EGM) called for this purpose. The EGM is expected to be held in the second quarter of 2017. The transaction is also subject to regulatory conditions, approval under Hart-Scott-Rodino Antitrust Improvements Act, resignation of Directors of Actelion, completion of spin off, the approval of the Actelion shareholders of the distribution of the shares of R&D NewCo and other customary offer conditions described in the offer prospectus, which will be filed by mid-February 2017. The transaction was unanimously approved by the Boards of Directors of both Johnson & Johnson and Actelion. Actelion's Board of Directors unanimously recommended that Actelion shareholders tender their shares into the offer and vote in favor of the distribution of shares at the EGM. As of March 31, 2017, the applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, with respect to Janssen's acquisition of Actelion have either expired or been terminated early. The transaction is approved by Japan Fair Trade Commission and Israeli Antitrust Authority.

As of February 16, 2017, an extended period may begin on April 6, 2017, and end on April 21, 2017. On February 16, 2017, Swiss Takeover Commission approved the takeover offer. As of March 3, 2017, FTC granted early termination of antitrust approval waiting period. As of March 30, 2017, a total of 83.2 million shares including treasury shares are tendered corresponding to 77.2% of total shares. Subject to the satisfaction of certain conditions, Janssen has declared the tender offer successful. The additional acceptance period of ten trading days will commence on April 6, 2017 and expire on April 21, 2017. As on April 21, 2017, following the expiry of the additional offer period, Johnson & Johnson holds 92.62% stake in Actelion. As of May 18, 2017, the EU Commission has extended the examination of the deal until June 12, 2017. On June 9, 2017, the antitrust authority approved the transaction between Johnson & Johnson (NYSE:JNJ) and Actelion Ltd (SWX:ATLN). The transaction is expected to close in the second quarter of 2017. The transaction is expected to accelerate Johnson & Johnson revenue and earnings growth rates and will be immediately accretive to Johnson & Johnson adjusted earnings per share.

Lazard and Citigroup acted as financial advisors, Robert I. Townsend, III, Damien R. Zoubek, Michael E. Mariani, Ashley Robson Mistretta, Sanjay Murti, George E. Zobitz, Jared B. Taylor, J. Leonard Teti II, Lingfeng Li, Andrew T. Davis, David J. Kappos, Anthony N. Magistrale, Jonathan J. Katz, Matthew J. Bobby, Sarah W. Colangelo and Kathryn-Ann Stamm of Cravath, Swaine & Moore LLP, Daniel Daeniker, Daniel Hasler, Gregor Bühler, Stefan Oesterhelt, Daniel Haeberli, Stefan Blunschi, Fiona Sauer, Guy Deillon, Marie Jenny, Karin Mattle, Camille Auberson, Roman Perrig, Richard Stäuber, and Eduard De Zordi of Homburger AG and Sexton Riley LLP acted as legal advisors for Johnson & Johnson. Bank of America Merrill Lynch and Credit Suisse acted as financial advisors, Philipp Haas, Ulysses von Salis, Thomas Broennimann, Bertrand Schott, Moritz Maurer, Deirdre Ni Annrachain, Julia Tolstova; Christina DelVecchio, Daniela Schmucki, Thomas Graf, Christina Rinne, Rachid Ghazi, Laurence Uttinger, Nicolas Birkhäuser, Clara-Ann Gordon of Niederer, Kraft & Frey, Daniel A. Neff, Gregory E. Ostling, John Robinson, Jillian Colbert Alsheimer, Franco Castelli, Greg Pessin, Adam Shapiro, Katherine O'Neill, T. Eiko Stange and Sehj Vathe of Wachtell, Lipton, Rosen & Katz LLP and Simon Nicholls, David Johnson, Susannah Macknay, Rob Innes, Harry Hecht, Anthony Doolittle, Claire Jackson, Henry Herbert, Susie Middlemiss, Richard McDonnell, Jeanette Zaman, Tom Windsor, Lisa Wright, Susan Zhuang and Andrew Gilbert of Slaughter and May acted as legal advisors for Actelion. Alantra acted as fairness opinion provider to Actelion. Saee Muzumdar of Gibson, Dunn & Crutcher LLP acted as legal counsel to Lazard Ltd, financial advisor to Johnson & Johnson.