Kenvue takeover speculation heats up as tax agreement nears expiration
Deal News | Jun 16, 2025 | EIN
Kenvue Inc, recently spun off from Johnson & Johnson, is the subject of increased takeover speculation as its tax agreement with Johnson & Johnson is set to expire, potentially clearing the way for a sale. Analysts from Jefferies consider Kenvue's brand lineup attractive, despite concentration and uneven performance, with brands like Tylenol and Neutrogena dominating US retail sales. Potential suitors, including Procter & Gamble, Unilever, and Haleon, are exploring acquisition scenarios, with P&G seen as the most logical acquirer due to its resources and portfolio fit, minimizing antitrust risks. An all-cash deal is projected to significantly improve P&G's earnings per share in the first two years post-acquisition. Meanwhile, Unilever might need to divest its food and ice cream businesses to manage debt while considering the deal. Analysts maintain a positive outlook on Kenvue, even in the absence of a deal, predicting growth due to increased brand reinvestment.
Sectors
- Consumer Health
- Consumer Goods
- Mergers and Acquisitions
Geography
- United States – Kenvue and potential acquirer P&G are based in the United States, and the primary focus is on the US market.
- United Kingdom – Unilever and Haleon, potential acquirers, have operations in the UK, relevant to the acquisition discussions.
Industry
- Consumer Health – Kenvue's portfolio includes consumer health brands such as Tylenol and Neutrogena, emphasizing its position in the Consumer Health industry.
- Consumer Goods – Potential acquirers like Procter & Gamble and Unilever operate in the consumer goods sector, aligning with Kenvue's product offerings.
- Mergers and Acquisitions – The article discusses potential acquisition scenarios involving major companies, highlighting activity within the M&A sector.
Financials
- 20% premium – Premium that might apply in a potential all-cash acquisition deal of Kenvue.
- $500 million – Synergies expected from a potential acquisition deal with P&G.
- 5% EPS accretion – Estimated earnings per share increase in the first year following an acquisition by P&G.
- 7.5% EPS accretion – Estimated earnings per share increase in the second year following an acquisition by P&G.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Kenvue Inc | Target Company | Company | A consumer health brand company recently spun off from Johnson & Johnson. |
| Johnson & Johnson | Selling Company | Company | Global healthcare company that spun off Kenvue Inc. |
| Jefferies | Corporate Finance Advisor | Company | Investment bank providing analysis and advice on the potential acquisition scenarios. |
| Procter & Gamble Co | Potential Acquirer | Company | Consumer goods corporation considered a logical acquirer of Kenvue given its portfolio fit. |
| Unilever PLC | Potential Acquirer | Company | British-Dutch multinational firm considering acquiring Kenvue to expand in consumer health. |
| Haleon PLC | Potential Acquirer | Company | Consumer health company exploring a potential merger with Kenvue. |