Johnson & Johnson is selling its remaining Kenvue shares

By Ciara Linnane

Company plans debt-for-equity exchange with Goldman Sachs and J.P. Morgan, followed by a secondary offering of 182.3 million Kenvue shares

Johnson & Johnson is selling its remaining shares in Kenvue Inc., the consumer-health business that it spun out last year.

The company will exchange the 182.3 million shares of Kenvue's common stock it still owns for Johnson & Johnson debt held by Goldman Sachs and J.P. Morgan, Kenvue said in a statement on Monday.

The shares will then be offered to the public in a deal underwritten by Goldman, J.P. Morgan and BofA Securities.

Kenvue (KVUE) will not receive any proceeds from the sale or from the debt-for-equity exchange. Once the debt-for-equity exchange is complete, the selling shareholders will sell the shares to the underwriters of the offering. Johnson & Johnson (JNJ) will no longer own any Kenvue shares once the deal is completed.

The news comes about a week after Kenvue reported first-quarter earnings that exceeded expectations and said it would cut about 4% of its global workforce.

The company entered a transition service agreement with Johnson & Johnson in 2023 under which it will provide services to the company for varying periods of time.

It has now launched a program to better position itself for growth that involves reducing pretax costs by about $350 million.

For more, read: Kenvue's stock jumps after earnings beat as company unveils plan to cut 4% of global workforce

The stock was up 0.6% Monday but has fallen 4% in the year to date, while the S&P 500 SPX has gained 9.5%.

-Ciara Linnane

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05-13-24 1017ET

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