Johnson & Johnson (NYSE: JNJ) is reportedly moving towards a potential sale of its orthopedics division, DePuy Synthes. This step aligns with the company’s strategy to separate the business, which was acquired in 2011 for a substantial $21.3 billion. Announced in October 2025, Johnson & Johnson aims to complete this separation within 18 to 24 months, with the goal of enhancing both strategic and operational focus.
During an earlier statement, Chief Financial Officer Joseph Wolk indicated that while the company had not finalized the method for the split, they were considering various options. These could include a spinoff, which Wolk noted would be the most resource-intensive approach. He emphasized that Johnson & Johnson remains “open to ideas that others might have,” suggesting they are exploring avenues that could maximize value, including a potential sale.
According to a report by Bloomberg Intelligence, the DePuy Synthes unit could be valued at approximately $20 billion, or $28 billion when including debt. This valuation is bolstered by DePuy Synthes’ impressive performance, as the unit generated $9.3 billion in annual sales, primarily from hip and knee replacement devices.
Interest from Buyers and Market Implications
As part of its preparations, Johnson & Johnson is currently assembling financial materials for meetings with prospective buyers in the coming weeks. Several prominent private equity firms are reportedly considering joint bids, while strategic medical device companies may also show interest in the unit. However, it is important to note that discussions are still in the preliminary stages, and a transaction has not been confirmed.
In its latest earnings report, Johnson & Johnson reported adjusted earnings of $2.46 per share for the fourth quarter of 2025, a notable increase of 20.6% compared to the previous year. This exceeded market expectations, which had anticipated earnings of $2.44 per share. The company is projecting sales for 2026 to range between $99.50 billion and $100.5 billion, surpassing the consensus estimate of $98.89 billion.
In stock market activity, Johnson & Johnson shares closed up 0.78% at $246.91 on the preceding Thursday, according to data from Benzinga Pro.
The potential sale of DePuy Synthes marks a significant shift for Johnson & Johnson, as the company seeks to streamline its operations and potentially enhance its competitive positioning in the medical device market. As developments unfold, stakeholders will be closely monitoring the situation for further updates on this significant corporate restructuring.
