Sanofi and Merck to merge animal health businesses
pharmafile | March 9, 2010 | News story | Sales and Marketing | Merck, Sanofi, animal health
Sanofi-Aventis and Merck have announced a joint venture, bringing together their animal health businesses Merial and Intervet/Schering-Plough.
The company’s say the merger of the units creates a potential global leader in animal health, with each company owning a 50% stake in the new divison.
“The upcoming combination of Merial and Intervet/Schering-Plough is an exciting opportunity for Sanofi-Aventis to create with Merck a leading company in the Animal Health strategic and growing sector,” said Sanofi’s chief executive Chris Viehbacher.
Viebacher continued: “I am convinced that, together, we will create strong value in bringing broader and improved offerings in both pet and production animal segments. This transaction represents another consistent milestone in our diversification strategy to bring sustainable growth to Sanofi-Aventis”.
Richard Clark, Merck chairman, president and chief executive said: “Merck has been in the animal health business for well over six decades and through this new joint venture, we will bolster our diverse portfolio and create a new global competitor poised for growth.”
Clark continued: “This new joint venture delivers on Merck’s commitment to customer focus by creating one of the broadest portfolios of animal health products and services in pharmaceuticals and biologics for millions of customers who include farmers, veterinarians and pet owners.”
The value of Merial has been fixed at $8 billion and the value of Intervet/Schering-Plough at $ 8.5 billion. There will therefore be a $250 million true-up payment to Merck to establish a 50/50 venture.
The worldwide animal healthcare market reached $19 billion in 2008. The market is expected to grow at 5% per year over the next five years, driven primarily by animal proteins and strong consumer needs for companion animal healthcare.
Merial and Intervet/Schering-Plough will continue to operate independently until the closing of the transaction.
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