Kenvue Inc (KVUE)

[DewDiligence]

Re: JNJ’s 9.5% equity stake

Actually, JNJ retained a 9.5% equity stake in KVUE following the split-off, so the phrase, “fully independent” in KVUE’s 8/23/23 PR (in the post I’m replying to) is perhaps misleading.

Still, the salient point is that JNJ does not intend to monetize its 9.5% equity stake in KVUE in the near future. JNJ could easily have exchanged 100% of its KVUE shares in the (heavily oversubscribed) voluntary exchange offer, so JNJ’s decision to retain a 9.5% stake is an indication that JNJ considers KVUE undervalued at the current share price.