Sep 18 2009
Sanofi-aventis (EURONEXT: SAN and NYSE: SNY) and Merck & Co., Inc. (NYSE: MRK) today announced that the acquisition by sanofi-aventis of Merck’s 50 percent interest in Merial Limited (Merial) has been completed.
Sanofi-aventis acquired Merck’s interest in Merial for a cash consideration of $4 billion (US). Formed in 1997, Merial is a leading animal health company that was a 50/50 joint venture between Merck and sanofi-aventis and is now a wholly-owned subsidiary of sanofi-aventis.
As per the terms of the agreement signed on July 29, 2009, sanofi-aventis also has an option, following the closing of the Merck/Schering-Plough merger, to combine the Intervet/Schering-Plough Animal Health business with Merial to form an animal health joint venture that would be equally owned by the new Merck and sanofi-aventis. If the option is exercised by sanofi-aventis, the formation of the new animal health joint venture would be subject to approval by the relevant competition authorities.
The acquisition of Merial is expected to be accretive to sanofi-aventis' adjusted net income from the first year.
Christopher A. Viehbacher, chief executive officer of sanofi-aventis declared: “I am very happy to welcome Merial in the sanofi-aventis family. This acquisition strengthens sanofi-aventis’ position in the attractive animal health market. It illustrates our strategy to grow and diversify our business in order to become a global diversified healthcare leader with a sustainable growth and a reduced risk-profile.”
"The sale of Merck's interest in Merial allows us to remain on track for the closing of our merger with Schering-Plough in the fourth quarter, as planned," said Richard T. Clark, chairman, president and chief executive officer. "With the new Merck, we look forward to gaining a strong market presence and pursuing valuable growth opportunities in the animal health sector."
Merial will report to Hanspeter Spek, executive vice president, Global Operations, sanofi-aventis.
In 2008, Merial ranked number three in the animal health market with sales of $ 2.7 billion and a market share estimated at 13.8 percent.