J&J; to Buy Inverness Unit for $1.3 Billion in Stock

Health-care products giant Johnson & Johnson is buying Inverness Medical Technology’s diabetes products business for $1.3 billion in stock.

In the deal announced Wednesday, Johnson & Johnson would get Inverness’ fluid sampling technology and One Touch blood glucose meters and test strips.

Inverness, based in Waltham, Mass., would spin off its businesses dealing with women’s health, nutritional supplements and clinical diagnostics to form a new company owned by Inverness shareholders.

The companies had announced two weeks ago that they were in advanced talks.

Inverness shareholders would receive Johnson & Johnson common stock valued at $35 plus stock in the new company for each Inverness share.

The boards of Johnson & Johnson and Inverness have approved the agreement, which will require the approval of Inverness shareholders.

The transaction also must clear antitrust review.

Inverness would become part of Johnson & Johnson’s LifeScan franchise, a leading maker of blood glucose monitoring systems for home and hospital use. Inverness’ blood glucose monitoring systems currently are marketed by LifeScan.

The business to be acquired by Johnson & Johnson would include two recent Inverness acquisitions--LXN Corp., which makes dual glucose and fructosamine monitors, and Integ Inc., which has developed advanced technology to test fluid in body tissue.

Johnson & Johnson also would gain rights to Debiotech technology, which will be used to develop an external insulin pump.

It is anticipated that the new company would be led by members of Inverness’ corporate management team, the companies said.

On the New York Stock Exchange, Johnson & Johnson shares fell $1.27 to close at $97.73. Inverness shares rose $1.16 to close at $36.11 on the American Stock Exchange.