Procter & Gamble Co (P&G) is to acquire the consumer health business of Merck KGaA for about 3.4 billion euros (US$4.21 billion), giving it vitamin brands such as Seven Seas, and greater exposure to Latin American and Asian markets.
P&G, whose stable of brands include Pampers diapers, Gillette razors and Vicks cough and cold products, yesterday said that the acquisition had been agreed upon and would enable it to expand its portfolio of consumer healthcare products.
Merck’s unit also includes vitamin brands such as Femibion, Neurobion and Nasivin.
The purchase price for Merck’s business suggests that the German company climbed down from price demands of as much as 4 billion euros, which sources said deterred initial suitors such as Nestle SA, Perrigo Co and Stada owners Bain Capital Private Equity LP and Cinven Partners LLP.
The price still implied a valuation of 4.7 times sales and about 19 times operating profit for the business, at the high end of recent deals seen in the sector, Morgan Stanley analyst Vincent Meunier said.
“This will help [Merck] focus on its pharma unit and refurbish its pipeline,” he said.
P&G said it would also terminate its consumer care joint venture with Teva Pharmaceutical Industries Ltd, PGT Healthcare LLP, on July 1, because their strategies are no longer aligned.
Merck said the divestment of its consumer health business does not change its goal of keeping net sales of its established prescription drugs, such as Erbitux against cancer and multiple sclerosis treatment Rebif, organically stable until 2022.
It would issue guidance for this year to reflect the sale of the consumer healthcare business when it publishes first-quarter financial results on May 15, it said in presentation slides.
It expects the sale to P&G to close by the fourth quarter, Merck said.
About 3,300 Merck employees, mainly from the consumer health unit, could move to P&G upon completion of the transaction.
As part of the deal, P&G would 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.
The deal does not yet include Merck’s French consumer health business, for which P&G has made a binding offer, Merck said.
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
Greek tourism student Katerina quit within a month of starting work at a five-star hotel in Halkidiki, one of the country’s top destinations, because she said conditions were so dire. Beyond the bad pay, the 22-year-old said that her working and living conditions were “miserable and unacceptable.” Millions holiday in Greece every year, but its vital tourism industry is finding it harder and harder to recruit Greeks to look after them. “I was asked to work in any department of the hotel where there was a need, from service to cleaning,” said Katerina, a tourism and marketing student, who would
i Gasoline and diesel prices at fuel stations are this week to rise NT$0.1 per liter, as tensions in the Middle East pushed crude oil prices higher last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week rose for the third consecutive week due to an escalating conflict between Israel and Iran, as the market is concerned that the situation in the Middle East might affect crude oil supply, CPC and Formosa said in separate statements. Front-month Brent crude oil futures — the international oil benchmark — rose 3.75 percent to settle at US$77.01
RSS