Mylan Pays $6.7 Billion to Acquire Merck Generics
Posted on: Monday, 14 May 2007, 12:00 CDT
Mylan Laboratories has won the auction to buy Merck KGaA's generics business with a $6.7 billion bid, beating rival offers from Teva Pharmaceuticals and Actavis.
The all-cash transaction has been approved by both boards, and subject to closing conditions, is expected to close in the second half of 2007. Mylan said that the acquisition would help the company expand into markets outside the US and create a combined company of 10,000 employees with a diversified revenue base.
Mylan estimated that the combined company would have had revenues of approximately $4.2 billion in 2006, edging it closer to rival Sandoz, Novartis' generics unit, which posted revenues of approximately $6 billion for 2006. Israel's Teva Pharmaceuticals remains top, with revenues of approximately $8 billion in 2006.
Pittsburgh-based Mylan said that it does not anticipate significant reductions in headcount, and will recoup its investment through synergies and growth. The deal was financed with secured debt from Merrill Lynch, Citigroup and Goldman Sachs.
Robert Coury, Mylan's vice chairman and CEO, said: "Mylan is already a leader in the US, the world's largest market, and through Matrix Laboratories controls one of the broadest API platforms in the world. Merck Generics provides us with leading positions in many of the world's other key regions. Together, we will form a powerful, diverse, robust and vertically integrated generics platform."
Source: Datamonitor
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