Monday March 9, 2009
Navivest

Merck & Co., Inc. (MRK) and Schering-Plough Corporation (SGP) have this morning, announced that their Boards of Directors unanimously approved a definitive merger agreement under which Merck and Schering-Plough will combine under the name Merck, in a stock and cash transaction.

Under terms of the agreement, shareholders of Schering-Plough will receive 0.5767 shares and $10.50 in cash for each share of Schering-Plough and each Merck share will automatically become a share of the combined company. Merck Chairman, President and CEO Richard T. Clark will lead the new entity.

Merck’s closing price of $22.74 on March 6, 2009, means SGP shareholders will be getting $23.61 for each of their SGP share, a 34% premium to SGP’s closing price on Friday, and values the deal at $41.1 billion.

If and when the transaction goes through, Merck shareholders will own approximately 68 percent of the combined company, with Schering-Plough shareholders owning the remaining 32%.
Merck expects that “the transaction will be modestly accretive to non-GAAP EPS1 in the first full year following completion and significantly accretive thereafter.”

Tags: merck schering plough merger acquisition