Boston Scientific raises offer for Guidant in war with J&J: who wins?

Boston Scientific Corp. increased its offer Tuesday for Guidant Corp. to about $27 billion (Ђ22.36 billion) from nearly $25 billion (Ђ20.7 billion) and set a deadline later in the day for a response, seeking to trump Johnson & Johnson in an increasingly pricey bidding war for the medical device maker. The latest proposal from Boston Scientific expires at 5 p.m. EST (2200 GMT) Tuesday. The company hopes the move will prompt Guidant's board to abandon its support of J&J's latest $24.2 billion (Ђ20.04 billion) bid, made Friday.

"By any objective measure, our offer is clearly superior to Johnson & Johnson's," Boston Scientific chairman Pete Nicholas said in a statement. J&J spokesman Jeff Leebaw declined to comment on Tuesday morning. A Guidant spokesman did not immediately return a call for comment.

J&J and Boston Scientific, rivals in the market for drug-coated heart stents, are dueling for Guidant's business in implantable defibrillators and pacemakers, a fast-growing $10 billion (Ђ8.28 billion) business in which neither suitor is a player.

Even before Boston Scientific's latest move, some analysts had suggested a revolt was possible by Guidant shareholders because Boston Scientific was offering a higher price than J&J, which countered that its deal offered greater certainty and a speedier route to closing.

Boston Scientific sought to derail a year of dealmaking between Guidant and J&J by making an unsolicited bid on Dec. 5 that it finalized on Jan. 8. If Guidant's board declares Boston Scientific's amended offer superior to J&J, it will remain open until Jan. 25. Any declaration that Boston Scientific's offer is superior starts a clock of five business days for J&J to respond, according to its agreement with Guidant.

Boston Scientific had previously offered an equal amount of cash and stock in its offer, but boosted the cash component on Tuesday, proposing to pay $42 in cash and $38 in stock for each share of Guidant.

It said the $80-per-share offer amounts to a premium of $9 per share, or a total of $3.3 billion (Ђ2.73 billion), over the latest $71-per-share offer from J&J. The company's offer is made up of $40.52 in cash and 0.493 shares of stock. Boston Scientific's latest offer also amends a separate deal announced Jan. 8 to address antitrust issues and related fears that a regulatory review could slow the closing of any deal, reports the AP. N.U.