Where other companies, including Nestle, Stada and Perrigo, failed, P&G succeeded. The purchase will help it expand its portfolio of consumer healthcare capabilities and brands.
On Thursday, Procter & Gamble Co and Merck KgaA stated, the former has agreed to acquire the consumer health business of the later for around $4.21 billion (3.4 billion euros) in cash.
The acquisition is aimed at enabling P&G to expand its portfolio of consumer healthcare capabilities and brands.
Merck’s consumer health unit includes brands such as Femibion, Neurobion, Nasivin and Seven Seas.
Significantly, the offer price suggests that Merck was probably forced to climb down from its demand of around 4 billion euros, which according to sources, deterred earlier suitors, including Nestle, Stada and Perrigo from buying it.
In a separate statement, Merck stated, the acquisition is expected to close by the fourth quarter of 2018.
As part of the deal, nearly 3,300 employees, mainly from its consumer health unit, will transition to P&G after the completion of the transaction, subject to prior works council consultation where required.
“The attractive price reflects the high asset value and the performance Consumer Health has delivered,” said Stefan Oschmann, chief executive of Merck.
As for Merck’s Indian business, P&G will buy a majority stake in Merck Ltd and subsequently make a mandatory tender offer to minority shareholders.