Merck KGaA to acquire Millipore for $7.2 billion

Merck KGaA announced that it entered into a definitive agreement to acquire biotechnology-equipment maker Millipore for $107 per share in cash or about $7.2 billion including net debt. “This is a combination with an excellent strategic fit, which will allow us to cover the entire value chain for our pharma and biopharma customers,” said Merck chairman Karl-Ludwig Kley.

Deutsche Bank analyst Ross Muken noted that the drugmaker will also gain Millipore’s expertise in testing and manufacturing biotech drugs. “The angle for Merck is access to high-growth biologics,” Muken said. Millipore allows Merck an opportunity to expand into biotechnology “without the pipeline risk,” explained the analyst.

The German company indicated that it anticipates that the combined business will generate cost synergies of about $100 million annually within three years of the deal's closing. Merck added that it expects the transaction to be completed in the second half of the year.

Millipore had sales of approximately $1.7 billion in 2009.

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