Chief executive officer (CEO) Stefan Oschmann first raised the possibility of a sale when he described the prescription-free business as being too small as an individual unit at Merck and announced a desire to focus more on the expensive development of prescription drugs.
Over three thousand employees of Merck are expected to shift to P&G after the purchase deal is finalized by the fourth quarter of this year.
It also offers P&G with healthcare commercial and supply capabilities, deep technical mastery and proven consumer healthcare leadership.
Turns out Procter & Gamble didn't want Pfizer's consumer health unit after all. Edelweiss Securities senior VP (institutional equities - research) Abneesh Roy said the move will help P&G in scaling up distribution at chemist shops in India, as it will now have a wider portfolio of OTC brands.
"With P&G we have found a strong, highly recognised player who has the necessary scale to successfully drive the business going forward", he said. "With this transaction, we continue to rigorously deliver on our strategy to become a global specialty innovator and bring breakthrough medicines to patients".More news: Putin, Trump will not allow armed confrontation between Russia, US - Lavrov
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"These leading brands and the great employees of the Consumer Health business of Merck KGaA, Darmstadt, Germany, will complement our Personal Health Care business very well", added Tom Finn, president, P&G Global Personal Health Care. It now looks to the Merck portfolio to help drive success.
Merck's consumer health brands grew 6 percent in the last two years, more than triple the growth P&G has achieved company-wide in recent years.
Operating in 44 countries and offering more than 900 products, Merck's Consumer Health division offers a OTC products for a variety of ailments including colds, headaches and pain.
The transaction will be executed through the sale of Merck KGaA's shares in a number of legal entities as well as various asset sales.
Market researcher Euromonitor notes that, in 2017, P&G was the ninth largest global consumer health corporation in terms of retail value.