Merck's big health brands snapped up by Procter & Gamble

10 Stocks To Watch For

10 Stocks To Watch For

The proposed deal with Procter & Gamble would allow Merck to focus on its core healthcare and life sciences business, Stefan Oschmann, the chief executive and chairman, said. It is a clear demonstration of our continued commitment to actively shape our portfolio as a leading science and technology company. "Consumer Health is a strong business that deserves the best possible opportunities for its future development".

A Reuters report said the acquisition Merck KGaA's consumer health unit will give P&G vitamin brands such as Seven Seas and greater exposure to Latin American and Asian markets.

According to Merck, between 2015 and 2017, its consumer health's net sales grew organically by 6 per cent, outpacing the consumer health market's growth of approximately 4 per cent over the same period.

Fueled by demand for Olay skin care products and its SK-11 brand, its net sales jumped 4.3% to US$16.3bn from the year-ago quarter, which came in above Wall Street analysts' forecast of US$16.2bn.


Tom Finn, president, P&G global personal healthcare, said the move helps the company to continue to drive sales and profit growth, by providing the capabilities and portfolio scale it needs to operate a winning global OTC business on its own, without the aid of a healthcare partner.

JP Morgan acted as financial adviser to Merck on the transaction, and Freshfields Bruckhaus Deringer was legal adviser. The deal comprises the Consumer Health business across 44 countries, including more than 900 products and two Consumer Health-managed production sites in Spittal, Austria, and Goa, India.

The selloff agreement wraps up a sale process the Darmstadt-based drugmaker embarked on last September, pointing to "increasing internal constraints to fund" its consumer health business.

As part of the deal, P&G will buy a majority stake in the German company's Indian consumer health business, Merck Ltd, and subsequently make a mandatory tender offer to minority shareholders.

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