Under the deal, Merck will acquire all of Sigma-Aldrich for $140 a share in cash, a 37% premium to Sigma’s latest closing price of $102.37.
The acquisition is expected to expand Merck Millipore’s global reach, increasing its presence in North America and adding exposure to fast-growing Asian markets.
Merck Executive Board chairman Karl-Ludwig Kley said the deal marks a milestone on its transformation journey aimed at turning its three businesses into sustainable growth platforms.
"For our life science business it’s even more than that: it’s a quantum leap. In one of the world’s key industries two companies that fit perfectly together have found each other to present a much broader product offering to our global customers in research, pharma and biopharma manufacturing and diagnostic and testing labs," Kley said.
"As such, the combination of Merck and Sigma-Aldrich will secure stable growth and profitability in an industry that is driven by trends such as the globalization of research and manufacturing.
"What’s more, the combination gives us the possibility to invest even more in innovation going forward. We are delighted to make this compelling proposition to Sigma-Aldrich’s shareholders, who will obtain full and certain cash value for their shares."
The deal will see both firms provide their customers a complementary range of products across laboratory chemicals, biologics and reagents.
Sigma-Aldrich president and chief executive officer Rakesh Sachdev said: "The combined company will be well-positioned to deliver significant customer benefits, including a broader, complementary range of products and capabilities, greater investment in breakthrough innovations, enhanced customer service, and a leading e-commerce and distribution platform in the industry."
The transaction, which is subject to regulatory approvals and other customary closing conditions, is expected to be closed in mid-2015.
Image: Merck CEO Karl-Ludwig Kley and Sigma-Aldrich CEO Rakesh Sachdev. Photo: courtesy of Merck KGaA