Guidant to Be Acquired by Johnson & Johnson

Johnson & Johnson, the world’s biggest maker of medical devices, said late Wednesday that it agreed to buy defibrillator maker Guidant Corp. for $25.4 billion to gain electrical devices for treating heart disease.

In the deal, which had been rumored since last week, New Brunswick, N.J.-based J&J; would pay $76 for each share of Indianapolis-based Guidant, 40% of it in cash and the balance in stock, J&J; said in a statement.

The price for Guidant shares is 10.5% more than on Dec. 6, the day before the New York Times reported the companies were in talks. Guidant closed at $72.05 on the New York Stock Exchange, up $1.05 for the day, before the deal was announced. J&J; lost 53 cents to $60.90.

J&J; Chief Executive William Weldon needs new products to bolster sales, analysts say.

Interest in defibrillators has soared in the last three years after studies funded by Guidant and No. 1 producer Medtronic Inc. showed that heart attack survivors and patients with heart failure had a better chance of living with one of the devices.

Implantable defibrillators are small devices that sense irregularities in the heart’s rhythm and send a shock when necessary to restore a normal heartbeat. The devices differ from pacemakers, which are designed to increase a slow heart rate.

J&J; has annual sales of $46 billion. Guidant’s annual sales are about $3.7 billion.