J&J Proceeds with Crucell Takeover, Leaves Options Open

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Johnson & Johnson (NYSE:JNJ) will go ahead with its $2.27 billion takeover of Crucell NV (NASDAQ:CRXL), the US company said Wednesday, but it is keeping the option to alter terms if problems at the Dutch biopharmaceutical company’s South Korean manufacturing plant prove worse than expected.

Crucell temporarily suspended operations at its Shingal site in South Korea and halted shipments of two vaccines due to sterility issues. The issues caused Crucell to lower its full-year guidance.

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While the root cause of the issues are still under investigation, the facility is set to resume production in February 2011.

In a joint statement released Tuesday, the companies said they are moving forward with the deal, but noted that “while the immediate financial impact of the Korea manufacturing issues to Crucell,” would not alone constitute a “material adverse effect,” all effects related to the manufacturing issues in Korea, "including those related to the period prior to commencement of the offer," may be taken into account.

The other effects have to be in combination with further developments that may arise or become known to J&J regarding the Korea manufacturing issues after the commencement of the offer, the companies said.

J&J expects to obtain final approvals and commence the offer in advance of the previously announced Crucell shareholder meeting on Dec. 10 in Amsterdam.

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