Are signs of life emerging from the moribund IPO market?
If Johnson & Johnson (NYSE:JNJ)’s corporate advisors are correct, then, yes, possibly.
For cotton bud maker J&J has set a listing valuation for Kenvue, its consumer business of up to US$43bn.
On that basis, the group would be worth almost three times its historic revenue, which is in line with rival Haleon PLC (LSE:HLN, NYSE:HLN)’s current multiple.
The news marks a significant step forward for one of the most anticipated IPOs of the year and moves the healthcare giant closer to finalising the planned spinoff of the maker of Band-Aid bandages and Tylenol medicines.
However, the IPO market in the US is currently facing challenges. New listings have slowed significantly, as investors navigate increased volatility and rising interest rates.
In the upcoming IPO, J&J plans to offer 151.2 million shares of Kenvue's common stock, with prices ranging from $20 to $23 per share. The company hopes to raise as much as US$3.5 billion, based on the upper limit of the proposed price range.