KVUE starts trading on NYSE

shares Johnson & Johnsonof consumer health Kinfu It jumped 22% on Thursday after its market debut on the New York Stock Exchange, making it the largest initial public offering in the United States in more than a year.

Shares of the new company closed at $26.90 after opening at $25.53. Kenvue originally priced the Initial public offering At $22 Wednesday night, towards the upper end of the target range.

Thursday’s move values ​​the company at nearly $50 billion.

Kenvue sold 172.8 million shares in the offering, raising $3.8 billion and putting the company at a valuation of about $41 billion. The company initially planned to sell 151 million shares.

The company, which trades under the symbol KVUE, owns a wealth of widely known consumer brands such as Band-Aid, Tylenol, Listerine, Neutrogena, Aveeno, and J&J’s baby powder of the same name.

“Millions of consumers around the world wake up this morning with a Kenvue product in their home,” CEO Thibaut Mongonin an interview on CNBC’s “Squawk on the Street” Thursday morning before the shares went public for the first time.

Mongon was previously Executive Vice President of J&J Corporation and Global President of Consumer Health. It will sit on the Kenvue board.

Kenvue’s IPO marks the largest restructuring move in J&J’s 135-year history.

J&J first announced the spin-off in November 2021 as an effort to streamline operations and refocus on its fast-growing medical device and pharmaceutical divisions.

But the company in general will be able to control the direction of Kenvue’s business and what matters shareholders vote for at present: the health giant will own 1.7 billion shares of Kenvue’s common stock after the IPO is completed, accounting for a 90.9% stake. J&J will reduce its remaining stake in Kenvue later this year.

Mongon told CNBC that J&J has been “very clear” about its intent to part ways with Kenvue this calendar year.

Kenvue expects to pay a quarterly cash dividend of about 20 cents per share beginning in the third quarter, which ends Oct. 1, and Mongon called it “an attractive dividend policy that will be a way for us to return more value to shareholders.”

Meanwhile, consumer-focused Kenvue is already turning a profit. The subsidiary reported $14.95 billion in sales for 2022 and net income of $1.46 billion on a pro forma basis, according to preliminary prospectus Filed with the Securities and Exchange Commission last week.

“We’re doing it from a position of strength,” Mongon told CNBC. “Kinfo is a healthy business.”

For the first quarter, which ended April 2, Kenvue estimated that it had sales of $3.85 billion and net income of about $330 million. These results are preliminary.

It expects annual sales growth through 2025 to be around 3% to 4% globally, according to the filing.

J&J’s IPO is still responsible for thousands of claims that baby talcum powder and other talcum products caused cancer. These products fall under the Company’s consumer health business, now Kenvue, but the subsidiary will only assume liabilities relating to those that originate outside the United States and Canada, according to Subscription deposit from january.

When asked about the commitments, Mongon said Kenvue is “focused on what we do best: serving our customers as well as our portfolio with the brands we mentioned.”

The debut raises hopes that the muted US market for initial public offerings can recover after that collapsed last year.

Kenvue’s IPO raised more than any other offering this year so far, according to a report from Renaissance Capital. The 40 IPOs in 2023 have resulted in a grand total $2.4 billion.

The subsidiary offering is also the largest initial public offering since electric car maker Rivian’s IPO in November 2021.