Merck Announces Acquisition of Sigma-Aldrich for $14 Billion
Merck & Co., Germany, announced on Monday that it will acquire Sigma Aldrich Life Sciences for a total of $14 billion per share for a total of $14 billion, and will expand its operations in North America to expand its presence in the US market. The total transaction amount is 37% additional based on the closing price of Sigma-Aldrich on September 19. The final transaction is expected to be reached in mid-2015.
Merck chairman Karl-Ludwig Kley believes that "the transaction represents a milestone for the three major business groups to enter the sustainable development platform." The company's executive committee believes that the company's merger will further expand its global research, pharmaceutical, biologics and laboratory diagnostics and testing customer base.
In 2010, Merck acquired the biotech equipment maker Millipore and its network business for 7.2 billion. After four years of acquisition of Millipore, its profit return exceeded 4.5 billion euros. Earlier this year, Kley had hinted that the company had ample business balance and could purchase further.
Kley believes that the acquisition of Sigma-Aldrich Life Sciences will ensure the company's growth and profitability due to the globalization of research and equipment manufacturing. According to Merck's performance, the company's combined life sciences business will sell 4.7 billion euros in 2013, an increase of 79%, and a profit of 1.5 billion euros, an increase of 139%. Merck’s total fiscal revenue increased by 19%. Merck believes that revenue is expected to proliferate immediately after the transaction, and it is expected to receive an annual total of 260 million euros in the three years after the acquisition.
Kley also stated that the final consideration of the transaction was taxation, although there have been recent mergers by pharmaceutical companies to reduce tax rates. We look at business matching, we look at business opportunities, when you have to take into account labor costs and infrastructure costs. And stressed that in the United States it may cost less than Europe.
Sigma-Aldrich shareholders voted unanimously to agree to the acquisition by the two companies.
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