Merck and Sigma-Aldrich have entered into a definitive agreement under which Merck will acquire Sigma-Aldrich for $17.0 billion (€13.1 billion), establishing one of the leading players in the $130 billion global life science industry.
Merck will acquire all of the outstanding shares of Sigma-Aldrich for $140 per share in cash. The agreed price represents a 37 per cent premium to the latest closing price of $102.37 on September 19, 2014, and a 36% premium to the one-month average closing price. The transaction is expected to be immediately accretive to Merck’s EPS pre and EBITDA margin. Merck expects to achieve annual synergies of approximately €260 million (approximately $340 million), which should be fully realized within three years after closing.
Karl-Ludwig Kley, Chairman of Executive Board, Merck said, “This transaction marks a milestone on our transformation journey aimed at turning our three businesses into sustainable growth platforms. The combination of Merck and Sigma-Aldrich will secure stable growth and profitability in an industry that is driven by trends such as the globalization of research and manufacturing.”
Rakesh Sachdev, President and Chief Executive Officer, Sigma-Aldrich, said, “The combined company will be well-positioned to deliver significant customer benefits, including a broader, complementary range of products and capabilities, greater investment in breakthrough innovations, enhanced customer service, and a leading e-commerce and distribution platform in the industry. This transaction is a clear validation of our success in transforming Sigma-Aldrich into a customer-focused and solutions-oriented global organisation.”
The combined company will be able to serve life science customers around the world with a highly attractive set of established brands and an efficient supply chain that can support the delivery of more than 300,000 products. In the laboratory and academia business, together Merck Millipore and Sigma-Aldrich will offer their customers a complementary range of products across laboratory chemicals, biologics and reagents. In pharma and biopharma production, Sigma-Aldrich will complement Merck Millipore’s existing products and capabilities with additions along the entire value chain of drug production and validation.
EP News Bureau– Mumbai
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