Merck KGaA Acquires Sigma-Aldrich for $17 Billion

Merck KGaA announced on Sept. 22, 2014 that it has agreed to buy Sigma-Aldrich for $140 per share in cash, or a total of $17 billion. The purchase will expand the reach of Merck’s EMD Millipore chemical and equipment division, “increasing the company’s presence in North America and adding exposure to fast-growing Asian markets,” according to a from EMD.  Sigma-Aldrich is a life-sciences company that specializes in products used in scientific R&D in fields such as biotechnology, genomics, and pharmaceuticals. 

Merck said the transaction will be immediately accretive to Merck KGaA, and Sigma-Aldrich will become part of Millipore. The acquisition is touted to be the largest in Merck's history.

Merck Chairman of the Executive Board Karl-Ludwig Kley said in an interview that with this acquisition, Merck is doubling its business earnings for the academia and lab markets. “Currently we are under-represented in the US and with the strong presence of Sigma-Aldrich in the US market, we’ll have a size which really allows us to take products and service to the customer throughout this great country.”

The transaction is expected to close by mid-2015. Merck expects annual synergies of about €260 million (approximately $333 million), which should be fully achieved within three years after closing, pending regulatory approval.

Source: EMD