Merck agrees to buy Schering-Plough in $41bn merger deal

09 March 2009 13:59  [Source: ICIS news]

(LONDON ICIS news)--Merck & Co has agreed to buy rival US pharmaceutical group Schering-Plough for $41.1bn (€32.5bn) in cash and shares, the companies said in a joint statement on Monday.

Under the agreement, Schering-Plough shareholders would receive 0.5767 share and $10.50 in cash for each share – valuing the shares at $23.61. The offer represents a 34% premium on Friday's closing share price.

“The combined company will benefit from a formidable research and development pipeline, a significantly broader portfolio of medicines and an expanded presence in key international markets, particularly in high-growth emerging markets,” said Merck chairman, president and CEO Richard Clark, who will lead the combined company.

Merck shareholders would own about 68% of the combined company following the deal, with Schering-Plough shareholders holding the remaining 32%.

The deal was expected to by “modestly accretive” to earnings in the first full year after completion and “significantly accretive” after that.

The transaction would be structured as a reverse merger, whereby Schering-Plough, renamed Merck, would continue to survive as the public corporation.

($1 = €0.79)

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By: Mark Watts
+44 20 8652 3214



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