"Merck, a leading science and technology company, announced that it has signed an agreement to sell its global consumer health business to P&G for approximately 3.4 billion pounds in cash, or approximately $4.2 billion at current exchange rates", the drug-maker said in a regulatory filing to the BSE. For the full year 2017, net sales of the consumer health business amounted to 911 million pounds.
P&G officials said in a prepared statement this will "compliment" their health brands Vicks, Metamucil, Pepto-Bismol, Crest and Oral-B.
The deal adds Merck's vitamin and food supplements to P&G's existing roster of over-the-counter medicines.
The selloff agreement wraps up a sale process the Darmstadt-based drugmaker embarked on last September, pointing to "increasing internal constraints to fund" its consumer health business.
They include a range of over-the-counter (OTC) product remedies to relieve muscle, joint and back pain, colds and headaches along with products for helping in physical activity and mobility.
P&G's acquisition will allow the company to expand its consumer health business by adding a portfolio of 900 products that is active in 44 countries.
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And it'll also fill a void left by a healthcare joint venture between P&G and Teva, which is set to end July 1.
Merck also expects the transaction to improve its flexibility to bolster its three business sectors - healthcare, life science and performance materials.
"P&G's global scale and strategic interest in the health and well-being of consumers provide an excellent basis for accelerating growth, leveraging our teams' capabilities and expanding the Consumer Health business profitably", commented Belén Garijo, Member of the Executive Board of Merck.
As part of the deal, P&G will 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.