Procter & Gamble to acquire Merck’s consumer health business for €3.4bn
P&G acquisition of Merck consumer health business : US consumer goods company Procter & Gamble (P&G) has agreed to acquire German pharma company Merck’s consumer health business in an all-cash deal worth around €3.4 billion ($4.2 billion).
P&G Acquisition of Merck Consumer Health Business
The transaction will help P&G to widen its consumer health business through the addition of a fast-growing portfolio of differentiated, OTC brands sold across 44 countries.
It will also complement the US consumer goods company’s current capabilities in consumer health care and also its brands like Vicks, Metamucil, Oral-B, Pepto-Bismol and Crest.
Commenting on P&G acquisition of Merck consumer health business, David Taylor, Chairman of the Board, President and CEO of Procter & Gamble, said: “We like the steady, broad-based growth of the OTC Health Care market and are pleased to add the Consumer Health portfolio and people of Merck KGaA, Darmstadt, Germany, to the P&G family.”
The OTC brands included in the deal include muscle relief products, joint and back pain solutions, cold and headache relief products, and also those which help in supporting physical activity and mobility. P&G says that several products to be added through the acquisition are for treatment areas that are not addressed currently in its own consumer health portfolio.
The US consumer goods company revealed that the Merck consumer health business will take over and improve upon the PGT Healthcare joint venture that it has with Israel-based Teva Pharmaceutical Industries, which is due to end on 1 July, depending on regulatory approvals.
After a recent review, both Teva and P&G had mutually agreed to scrap the PGT Healthcare joint venture. PGT product assets will be owned by their respective parent firms to reestablish standalone OTC businesses.
Some of the key OTC brands to be acquired from Merck by P&G are Nasivin, Femibion, Nasivin, Neurobion, Dolo-Neurobion, Kytta, Bion3 and Seven Seas, which are available mainly across Asia, Europe and Latin America.
Tom Finn – President, P&G Global Personal Health Care, commenting on P&G acquisition of Merck consumer health business, said: “These leading brands and the great employees of the Consumer Health business of Merck KGaA, Darmstadt, Germany, will complement our Personal Health Care business very well.
“This acquisition helps us continue to drive sales and profit growth for P&G by providing the capabilities and portfolio scale we need to operate a winning global OTC business on our own, without the aid of a health care partner.”
For Merck, the sale of its consumer health business will help it cut down its debt and narrow its focus on healthcare, life science and performance materials.
Stefan Oschmann – Chairman of the Executive Board and CEO of Merck, on P&G acquisition of Merck consumer health business, said: “The divestment of our Consumer Health is an important step in our strategic focus on innovation-driven businesses within Healthcare, Life Science and Performance Materials.
“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. With P&G we have found a strong, highly recognized player who has the necessary scale to successfully drive the business going forward.”
Based on receipt of regulatory approvals along with meeting of customary closing conditions, P&G acquisition of Merck consumer health business is targeted to be wrapped up during the 2018/19 fiscal year by the US consumer goods company.