Well, it took a bit, but what we all expected will now begin: the process of sorting out which parts of the Animal Health juggernaut will need to be divested -- and to whom. See this Reuters wire-story, overnight:
. . . .Sanofi-Aventis and Merck agreed to reforge ties in animal health, combining the French drugmaker's Merial unit and Merck's Intervet/Schering Plough to take the top spot in the $19 billion market.
The equally split joint-venture complements Merial's predominance in pets with Merck/ISP's stronger position in livestock and their geographical presence in a sector which is estimated to grow an annual 5 percent on average until 2014.
Sanofi will pay Merck $250 million on top of an extra $750 million already agreed on last year when Sanofi bought Merck's stake in their Merial business for $4 billion. At the time both drugmakers said they would explore a tie-up.
The joint-venture will surpass Pfizer Animal Health, if it wins anti-trust clearance from regulators in the United States, Europe and other countries. . . .
Neither company would comment on their proposed joint approach to resolving the obvious anti-trust issues raised by the deal (if unchecked, it will catapult past Pfizer, to become the world's largest animal health concern), but earlier estimates by people with knowledge of the operations (here on my blog -- in the comment box) guessed that perhaps one-third of the to-be-combined assets will have to be divested to clear the various competition regulators. Even if that's what ultimately transpires, I still think it will still be the largest animal health concern on the planet. We'll keep you informed, right here.
No comments:
Post a Comment