NU - J&J spinout Kenvue shares climb 22% following $3.8B upsized IPO (update)

2023-05-04 16:19:47 ET

Johnson & Johnson ( JNJ ) spinout Kenvue ( NYSE: KVUE ) saw its shares 22% Thursday after it raised $3.8B through the largest US initial public offering since 2021.

Shares of Kenvue opened at $25.53 after being priced at $22, later dipping to a low of $25.25 followed by a high of $26.97. The stock closed at $26.90.

Kenvue priced 173M shares at $22 per share, raising around $3.8B. Underwriters were granted a 30-day option to buy up to 26M additional shares to cover over-allotments.

The deal is the largest IPO since 2021. Only three 2021 IPOs raised more than Kenvue: Rivian ( RIVN ), which raised $11.9B, followed by Coupang ( CPNG ) and Didi ( NU ). In comparison, 2022's biggest IPO, Corebridge, raised $1.7B.

Kenvue was J&J consumer products division, marketing such well-known brands as Band-Aid, Listerine, Neutrogena, Aveeno and Tylenol. After the IPO closes, J&J will own 91% of Kenvue's outstanding common stock. If the underwriters exercise their option in full, it will own 90%, according to the company.

The IPO was upsized from a deal proposed in late April that had Kenvue offering 151M shares priced between $20 and $23 per share, which would have raised about $3.25B.

Kenvue will compete against another Big Pharma spinout, Haleon ( HLN ). The consumer products company, which markets brands such as Advil and Centrum, was spun out through an IPO by GSK ( GSK ) in July 2022. Pfizer also holds a major stake in the company.

Earlier this week, Pfizer's CFO told the Financial Times that the company plans to begin selling its 32% stake in Haleon in the coming months.

For further details see: